It can be noted that the RBI has discontinued the practice of loan recast for the last few years, but has created an exception for small businesses after Governor Shaktikanta Das took over.
"We have requested the NHB (National Housing Bank, sector regulator) and others to take a relook at the provisioning and the NPA issue on projects that are stuck and need the last mile funding, Parekh told reporters.
We are talking to the regulators, we have spoken to the finance ministry, one time restructuring is absolutely necessary, he added.
Parekh said there have been precedents of similar one-time reliefs being allowed by the RBI in the past including in 1993 and also after the global financial crisis.
He said there are a host of reasons beyond financial stress of the promoter alone which lead to NPAs in the case of realty projects, including lack of environmental, tree authority or NGT approvals, which stop a project from taking off.
When asked if he has heard from either the regulator or the finance ministry, Parekh replied in the negative.
He welcomed the Rs 25,000 crore as a good beginning and added that the fund has already approved four proposals but did not share any details of the same.
HDFC has invested Rs 250 crore in the first Rs 12,500 crore fund anchored by SBI Caps and have a representative on the managing board, he said.
Parekh said the remainder fund of Rs 12,500 crore may be anchored by NIIF or some other fund.
Meanwhile, when asked when he sees a revival in the realty market, Parekh asked investors to forget about their bets for the next five years on the residential side, hinting that a recovery is unlikely soon.
Parekh said while it is a good time to buy houses for staying, residential property investments may at best yield one or two per cent return if rented out and also said it is better not to rent those out.
He, however, said the commercial market is booming.
Finance Minister Nirmala Sitharaman will present the Union Budget 2020-21 on February 1.
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