Banks are almost done giving mandates to insolvency professionals for the 12 big accounts, which are responsible for nearly Rs 2 lakh crore of bad debts in the banking system.
According to sources, a bank with the highest exposure in working capital loans, and not term loans, will decide on the insolvency professionals. Thus, for example, in case of Amtek Auto, State Bank of India has a share of Rs 3,500 crore, while Corporation Banks share in term loan is Rs 400 crore, but the latter has highest share in working capital loan given to the company. Therefore, Corporation Bank invited bids to fix insolvency professionals and gave the mandate to EY.
According to sources, so far in seven large cases in…
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