Scheme for Sustainable Structuring of Stressed
Assets, or S4A, the scheme, launched in June,
allows banks to convert up to half the loans of
stressed corporates into equity or equity-like
instruments. A bank will have to decide on the
'sustainable' portion of the debt. The rest can be
converted into equity. The RBI has now allowed
the sustainable portion of the debt to be treated
as a standard asset in all cases, subject to certain
conditions. While guidelines will be issued by this
month-end, the leeway will offer relief to banks
in terms of provisioning and ease up capital to an
extent.
0 comments:
Post a Comment