retired most of its CPs since October last year; it has an outstanding of about Rs 220 crore. In a statement, DSP Mutual Fund (MF) said it received a payment of Rs 150 crore from DHFL towards CPs. DHFL plans to pay about Rs 70 crore to IDBI MF. With these payments, it will not have any outstanding CP on its balance sheet.
The remaining Rs 580 crore is likely to be utilised to meet the interest obligation due to banks. DHFL on Monday intimated stock exchanges that it has honoured payment obligations due till July 5.
“By furnishing interest for this period, DHFL will remain a standard asset for the banks. The banks to will also get more time to work on the resolution plan,” said a source.
DHFL had last honoured its interest obligation to banks on June 4. Since June 25, lenders have been working on the resolution mechanism under the June 7 circular issued by the Reserve Bank of India (RBI).
June 7 circular allows 180 days for banks to implement the resolution plan and avoid provisioning under the said circular. However, RBI norms on income recognition and asset classification or IRAC requires a loan account in default for 90 days or more, to be classified as an NPA and be provided for accordingly.
At present, DHFL remains a standard asset for banks, though private entities such as Axis Bank and IDFC First have made voluntary provisioning towards their exposure to it.