NEW DELHI: Even as Indian banks’ loans to the telecom sector continue to face elevated risk, the recent developments and the lack of clarity over them are becoming a big concern for the banking industry, said Punjab National Bank (PNB) Managing Director and CEO SS Mallikarjuna Rao.
Referring to Kumar Manglam Birla’s letter to the government where he has offered to hand over his stake in Vodafone-Idea (Vi) if that could save the company, Rao said PNB will discuss with other banks to come to a conclusion on the way forward.
“Developments in the last few days are areas of concern for the banking industry to look at….” Rao said. Even SBI chairman has stated that banks will probably not be willing to fund telecom companies in the absence of clarity, he added.
Birla’s letter comes after the Supreme Court had rejected Bharti Airtel, Vodafone Idea and Tata Teleservices' plea seeking re-computation of the adjusted gross revenue (AGR)–related dues.
Birla owns more than 27% stake in Vi; the partner and global firm Vodafone Plc holds over 44%.
The company has to pay a total AGR dues of more than Rs 60,000 crore over 10 years. In addition, the company owed Rs 96,270 crore as deferred spectrum obligations, and another Rs 23,000 crore to banks and financial institutions as of March 31 this year.
'Never objected to PNB Housing’s deal with Carlyle'
Nearly a month after it asked PNB Housing Finance Ltd's board to “reconsider restructuring” its Rs 4,000-crore fundraising plans, PNB CEO said the lender never objected to the deal struck by its arm with Carlyle Group-led investors. We have only told them that SEBI communication may be looked into in terms of reconstruction of the process,” said Rao, who is also the non-executive chairman of PNB Housing.