More than 20 Indian lenders on Monday signed a pact aimed at faster resolution of bad loans, officials said, while more could join by the end of the week in what is the latest bid to cut record levels of soured assets in Asia\u2019s third-biggest economy.<\/p>\n
A government-appointed panel this month proposed the so-called inter-creditor agreement among other measures after criticism that at times smaller lenders in a lending consortium were creating roadblocks for speedier resolution.<\/p>\n
The agreement gives a bigger say to the lead lender in a consortium and allows a resolution plan to be approved if 66% of the banks in the group agree to it. Dissenting lenders have the option to sell their stressed loans to a company at a discount, or buy out loans to that entity from all other lenders at a premium.<\/p>\n
\u201cThe objective is to use this inter-creditor agreement for faster facilitation of the stressed assets resolution,\u201d said Sunil Mehta, the non-executive chairman of second-biggest state-run lender Punjab National Bank, who also headed the panel.<\/p>\n
\u201cOne of the major issues was consensus among lending banks on what should have been a common resolution plan,\u201d Mehta said.<\/p>\n
Top lender State Bank of India was among banks which signed the agreement.<\/p>\n
India\u2019s banks had 12.5% of their total loans categorised as non-performing or restructured at the end of March, according to central bank data.<\/p>\n","protected":false},"excerpt":{"rendered":"
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