2016Mumbai, Dec 24 (PTI) Since the National Company LawTribunal (NCLT) was set up 18 months ago, over 4,300 caseshave been filed at its various benches for resolution process,according to the Reserve Bank data.
The insolvency and bankruptcy code came intoexistence with the enactment of the Insolvency and BankruptcyCode (IBC) in May 2016, replacing the Company Law Boardregime.
"As of November 2017, over 4,300 applications underthe corporate insolvency resolution process (CIRP) were filedin the various benches of NCLT," the RBI said in its FinancialStability Report (FSR) released over the weekend.
Of these, more than 500 applications seeking admissionfor insolvency proceedings were rejected, dismissed orwithdrawn, it added.
The report said around 470 cases admitted by the NCLTare at various stages of the insolvency process.
In June this year, the Reserve Bank had asked banks torefer the 12 largest dud accounts totalling about 25 per centof the gross NPAs of the banking system or worth about Rs 2.5trillion to the NCLT for resolution. And 11 of them are inNCLT now.
Later in August, the central bank gave the banks alist of another 28 more large accounts to be resolved byDecember 13, failing which those accounts would have to bereferred to the NCLT by December 31. These accounts constituteanother 15 per cent of the system-wide bad loans and of thesebanks have sent as many as 25 to the NCLT.
The bad loans in the system have crossed the Rs10-trillion-mark or 10.2 per cent as of the September quarterfrom 9.6 per cent a year earlier and the FSR warned that grossNPAs would spike further to 10.8 per cent by March 2018 and toover 11.1 per cent by September 2018.
"The banking stability indicator shows that the risksremain at an elevated level weighed down by further assetquality deterioration," warned the report.
Overall, the stressed assets, including restructuredloans and dud loans increased to 12.2 per cent during the sameperiod from 12.1 per cent. Gross dud loans at the state-runbanks shot by 100 bps to 13.5 per cent while the same fortheir private sector peers jumped to 3.80 per cent.
Incidentally, the report said private sector lenders,considered more prudent are the ones reporting the moststress, reported a whopping 40.8 per cent spike in their GNPAsin the September quarter alone, as against 17 per cent by thestate-run banks whose lazy banking has been blamed primarilyfor the mess in the system.
All the top private sector lenders, including ICICIBank, Axis Bank and Yes Bank, and even HDFC Bank, have beenfound to have under-reported bad loans worth tens of thousandsof crores in the recent RBI supervision, results of which wererecognised over the first two quarters of the fiscal.
The report said so far in 25 CIRP transactions, NCLTshave approved the resolution plans or liquidation orders,whereas the admission of cases have been set aside by theorders of appellate authorities i.e. NCLAT or the SupremeCourt in 25 CIRPs admitted by the adjudicating authority. PTIHV BENNRB.
This is unedited, unformatted feed from the Press Trust of India wire.