(LiveMint)
State Bank of India (SBI) is looking to buy out Canara Bank’s loans of about ₹400 crore in Ratnagiri Gas and Power Pvt. Ltd (), the erstwhile Dabhol Power Co., said two people in the know. This is expected to be the first resolution under the inter-creditor agreement (ICA), which is part of the government’s Project Sashakt aimed at resolving bad loans. The step by SBI follows Canara Bank moving the National Company Law Tribunal (NCLT) in September against the demerger and debt restructuring of Ratnagiri Gas.
IDBI Bank Ltd is the lead lender of the consortium, but its lending activities are restricted under the Reserve Bank of India’s (RBI’s) prompt corrective action (PCA) framework, said one of the people cited above. “SBI, which has the second-highest exposure to Ratnagiri Gas, is discussing buying out Canara Bank’s stake under ICA to complete the resolution,” he said, adding the plan has yet to be finalized.
