MUMBAI: The non-banking finance company (NBFC) crisis has deepened further after unlisted Altico Capital India defaulted on the interest payment obligation on an overseas loan. The NBFC backed by foreign private equity players such as Clearwater Capital Partners, Varde Partners and Abu Dhabi Investment Council reportedly missed interest payment of Rs 19.97 crore on an overseas loan from Dubai-based Mashreq Bank.
The firm has a loan of around Rs 4,000 crore and at the centre of its troubles seem to be exposure to real estate developers.
“Our failure to repay the amounts set out above may result in an acceleration of interest repayment/redemption obligations in respect of non-convertible debt securities issued by,” Altico Capital said in a BSE filing.
India Ratings on September 3 had downgraded Altico Capital’s long-term issuer rating to ‘IND A+’ from ‘IND AA-’ and short-term issuer rating to ‘IND A1’ from ‘IND A1+’ with outlook “Negative”.
“Altico’s loan book (Rs 69 billion in June 2019) has exposure to real estate developers, many of whom have weak and stretched credit profiles,” India Ratings said.
Around 28 per cent of such loans were attributable to early-stage funding of projects as of July 2019, and 70 per cent of the loan book was under moratorium. “Headline NPA numbers remained under control till March 2019 (GNPA: 1.8 per cent), though incrementally pressure could build up as the loan book comes out of moratorium,” the rating agency said.
Well-known banker Naina Lal Kidwai had resigned as the chairman and director of Altico Capital on September 3. Quoting resignation letter accessed from MCA, media reports said Kidwai resigned on difference in views over the strategy and plans for the company.
The increased commitments with 14 board and committee meetings in 60 days Kidwai said, “I find this burden impossible to keep up and I would like to resign with immediate effect.”