The six months moratorium on payment of EMIs ended on August 31.
During the three-hour meeting, the statement said, the Finance Minister asked lenders to identify eligible borrowers and reaching out to them, and the quick implementation of a sustained resolution plan by lenders for the revival of every viable business.
Banks are in the process of getting a board-approved restructuring framework in line with the RBI's framework and eligibility defined by the central bank in its notification on August 6.
The Finance Minister also emphasised that resolution schemes must be rolled out by lenders by September 15, 2020, and a sustained media campaign to create awareness be carried out thereafter, the statement said.
She advised lenders to ensure that regularly updated FAQs on the resolution framework are uploaded on their websites in Hindi, English and regional languages, and also circulated to their offices and branches, it added.
On their part, bankers assured the Finance Minister that they are ready with their resolution policies and have started the process of identifying and reaching out to eligible borrowers and that they will comply with the timelines stipulated by the Reserve Bank of India (RBI).
The Ministry of Finance has also been engaging with the RBI to ensure that the lenders are assisted by the central bank in the resolution process.
The RBI last month permitted one-time restructuring of both corporate and retail loans without getting classified as a non-performing asset (NPA).
Restructuring benefit can be availed by those whose account was standard on March 1 and defaults should not be over 30 days.
Besides, K V Kamath committee is working on recommendations on financial parameters like debt service coverage ratio, debt-equity ratio post-resolution and interest coverage ratio for recasting corporate loans.
The resolution plans to be implemented under the framework may include conversion of any interest accrued, or to be accrued, into another credit facility, or granting of moratorium and/or rescheduling of repayments, based on an assessment of income streams of the borrower up to two years.
While the resolution under this framework can be invoked till December 31, 2020, the lending institutions have been encouraged to strive for early invocation in eligible cases, particularly for personal loans.
Last month, state-owned Punjab National Bank had said it expects to restructure loans worth about Rs 40,000 crore as per the RBI-approved guidelines.
(Only the headline and picture of this report may have been reworked by the Business Standard staff; the rest of the content is auto-generated from a syndicated feed.)
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