The ICA holds importance as it signals that banks are still hopeful about a possible resolution for RHF.
Reliance Home Finance (Photo: Facebook)
Lenders to troubled mortgage firm Reliance Home Finance (RHF) have extended the inter-creditor agreement (ICA) for another three months, in order to accommodate the four non-compliant bidders, reports stated.
Reliance Home Finance, part of Anil Ambani-promoted Reliance Group, recently got bids from six suitors as part of the debt resolution process.
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“The lenders of the company forming part of the Inter creditor Agreement (ICA), executed pursuant to the Reserve Bank of India (RBI) circular dated June 7, 2019 on Prudential Framework for Resolution of Stressed Assets, have extended the ICA period till March 31, 2021,” the company said in a regulatory filing.
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The ICA holds importance as it signals that banks are still hopeful about a possible resolution for RHF.
As per June 7 circular of the RBI, lenders can extend the time period of the pact if an account has not been resolved within 180 days of signing ICA. The lenders had signed the ICA last year.
Of the six bidders, only two submitted compliant and binding bids while four bids are non-binding and not compliant with bid conditions, sources said.
Lenders have decided to further extend the bidding timeline till January 31, 2021, in order to accommodate the four non-compliant bidders, sources added.
Retail disbursements of Reliance Home Finance had plunged amid tightening liquidity following the collapse of Infrastructure Leasing & Financial Services (IL&FS) in 2018, and significant debt repayments from September 2018 to February 2019 period.
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