India's publicly listed firms must disclose any failure to repay loans within 24 hours in cases where 30 days have passed since the default, its securities regulator said on Wednesday, tightening rules at a time when bond defaults have soared.

The decision was aimed at addressing any gaps in the availability of information to investors surrounding corporate defaults, the <a href="https://www.wionews.com/business-economy/sebi-to-expand-ofs-framework-relax-fpi-investment-clubbing-norms-182608">Securities and Exchange Board of India </a>(SEBI) said in a statement.

"The philosophy is that more and more information should be in the public domain that guides investors and other stakeholders," SEBI Chairman Ajay Tyagi told reporters in Mumbai.

The move comes as loan and bond defaults by companies, particularly several housing finance firms, are rising - adding to pressure on India's banks, which are saddled with a level of bad debt that is one of the world's highest.

India's housing finance companies and shadow lenders, a key source of credit to millions, have been battling a credit crunch since giant shadow bank IL&amp;FS collapsed in late 2018 amid fraud allegations.

Publicly-listed<a href="https://www.wionews.com/business-economy/sensex-nifty-nearly-flat-metal-stocks-drag-256379"> Dewan Housing Finance Corp Ltd </a>is one of India's top defaulters and owes close to 1 trillion rupees ($14 billion) to its debtors, which include banks and mutual funds.

The SEBI also tightened rules for portfolio managers, requiring that such firms must have a net worth of 50 million rupees ($696,233) from the earlier 20 million rupees.

It also doubled the required minimum investment by clients of portfolio managers to 5 million rupees from 2.5 million rupees.

"We have many clients between the 2.5 to 5 million-rupee bracket that is going to be disappointed," said Deepak Shenoy, the founder of Capitalmind, a portfolio manager in Bengaluru that manages 1.1 billion rupees in assets.

"It's not extremely bad (but) it will definitely affect business," Shenoy said.

&nbsp;

($1 = 71.8150 Indian rupees)

India's publicly listed firms must disclose any failure to repay loans within 24 hours in cases where 30 days have passed since the default, its securities regulator said on Wednesday, tightening rules at a time when bond defaults have soared.

India's publicly listed firms must disclose any failure to repay loans within 24 hours in cases where 30 days have passed since the default, its securities regulator said on Wednesday, tightening rules at a time when bond defaults have soared. The decision was aimed at addressing any gaps in the availability of information to investors surrounding corporate defaults, the Securities and Exchange Board of India (SEBI) said in a statement. "The philosophy is that more and more information should be in the public domain that guides investors and other stakeholders," SEBI Chairman Ajay Tyagi told reporters in Mumbai. The move comes as loan and bond defaults by companies, particularly several housing finance firms, are rising - adding to pressure on India's banks, which are saddled with a level of bad debt that is one of the world's highest. India's housing finance companies and shadow lenders, a key source of credit to millions, have been battling a credit crunch since giant shadow bank IL&FS collapsed in late 2018 amid fraud allegations. Publicly-listed Dewan Housing Finance Corp Ltd is one of India's top defaulters and owes close to 1 trillion rupees ($14 billion) to its debtors, which include banks and mutual funds. The SEBI also tightened rules for portfolio managers, requiring that such firms must have a net worth of 50 million rupees ($696,233) from the earlier 20 million rupees. It also doubled the required minimum investment by clients of portfolio managers to 5 million rupees from 2.5 million rupees. "We have many clients between the 2.5 to 5 million-rupee bracket that is going to be disappointed," said Deepak Shenoy, the founder of Capitalmind, a portfolio manager in Bengaluru that manages 1.1 billion rupees in assets. "It's not extremely bad (but) it will definitely affect business," Shenoy said. ($1 = 71.8150 Indian rupees)

India tightens rules on loan default disclosure for public firms

India's crisis-hit shadow bank <a href="https://www.wionews.com/india-news/nifty-sensex-edge-higher-auto-material-stocks-lead-236288">Dewan Housing Finance Corp</a> (DHFL) said on Friday its board had approved a plan that included converting debt into equity, even as it seeks to sell assets and raise more capital.

The conversion of debt into equity may result in a change in ownership, the company said in a regulatory filing, adding that the plan still needed shareholder approval.

DHFL, India's fourth-biggest housing finance company, has roughly 1 trillion rupees ($14.15 billion) of debt and owes about 400 billion rupees to banks alone.&nbsp;

The company hasn't been able to service its debt and it has defaulted on its obligations several times.

As a result, the non-banking financial company is undergoing a restructuring process that is being deliberated upon by its lenders, to help it ride out a liquidity crunch and restart its lending business.

DHFL and other shadow banking firms have been stung by a liquidity crunch following last year's collapse of Infrastructure Leasing &amp; Financial Services Ltd - once one of the biggest players in the sector.

DHFL's struggles also come as the domestic banking sector still grapples with nearly $150 billion of stressed assets.

India's crisis-hit shadow bank Dewan Housing Finance Corp (DHFL) said on Friday its board had approved a plan that included converting debt into equity, even as it seeks to sell assets and raise more capital.

India's crisis-hit shadow bank Dewan Housing Finance Corp (DHFL) said on Friday its board had approved a plan that included converting debt into equity, even as it seeks to sell assets and raise more capital. The conversion of debt into equity may result in a change in ownership, the company said in a regulatory filing, adding that the plan still needed shareholder approval. DHFL, India's fourth-biggest housing finance company, has roughly 1 trillion rupees ($14.15 billion) of debt and owes about 400 billion rupees to banks alone. The company hasn't been able to service its debt and it has defaulted on its obligations several times. As a result, the non-banking financial company is undergoing a restructuring process that is being deliberated upon by its lenders, to help it ride out a liquidity crunch and restart its lending business. DHFL and other shadow banking firms have been stung by a liquidity crunch following last year's collapse of Infrastructure Leasing & Financial Services Ltd - once one of the biggest players in the sector. DHFL's struggles also come as the domestic banking sector still grapples with nearly $150 billion of stressed assets.

DHFL board approves plan to convert debt into equity, sell assets

One of India's biggest housing finance companies, Dewan Housing Finance Corp Ltd (DHFL), warned on Saturday that its financial situation was so grim that it may not survive.

The company said it was "undergoing substantial financial stress" and its ability to raise funds was "substantially impaired and the business has been brought to a standstill with there being minimal/virtually no disbursements."

"These developments may raise a significant doubt on the ability of the company to continue as a going concern," it said in notes accompanying results for the fourth quarter ending March 31, signed by Chairman and Managing Director Kapil Wadhawan.

DHFL posted a net loss of 22.23 billion rupees ($324.3 million) during the quarter compared with a profit of 1.34 billion rupees in the same period a year earlier.

DHFL separately announced on Saturday it had defaulted on interest payments worth 285.8 million rupees on non-convertible debentures, due on July 6 and July 8.

The results are the latest sign of stress in India's banking and shadow lending sectors. The nation's state-owned banks have been burdened with bad debts for several years.

Reforming and restructuring banks and shadow lenders so they can do more to finance economic growth is a major challenge for the government of Prime Minister Narendra Modi, who recently secured a second term in an election landslide.

India's economic growth slipped to 5.8% in the January-March quarter, the lowest quarterly figure in more than four years. DHFL said it was talking to bankers and other lenders on restructuring its borrowings, was in discussions over the sale of its retail and wholesale portfolio and had also had talks with a potential strategic partner to take a stake.

Provisions

"The ability of the company to continue as a going concern is predicated upon its ability to monetize its assets, secure funding from the bankers/investors, restructure its liabilities and recommence its operations," it said in the notes.

The results published late on Saturday were unaudited. It was not immediately clear why its auditors had not signed off.

The audit committee had asked the board to submit audited stand-alone and consolidated financial results by July 22. The firm previously said it had delayed announcing results for the year to March 31 due to "unforeseen operational engagements."

The reported loss was largely due to additional provisions related to an assessment of the fair value of its portfolio and for an expected credit loss, the firm said.

Two major credit rating agencies - ICRA, an affiliate of Moody's Investors Service, and Standard &amp; Poor's local unit Crisil - last month categorised DHFL's commercial paper at default levels for missing bond payments.

The shadow banking sector has been in turmoil since September as Infrastructure Leasing and Financial Services (IL&amp;FS), one India's largest non-banking financial firms, defaulted, sparking fear of contagion risk. IL&amp;FS' series of debt defaults last year showed much of the sector was highly leveraged.

The Reserve Bank of India, the country's central bank, is taking a more active role in scrutinising the sector. It said last month that the failure of a large non-banking financial company could cause as much damage as the collapse of a big bank.

Adding to concerns about bad debts, Allahabad Bank on Saturday became the second Indian state-owned bank this month to report a major alleged fraud by bankrupt steelmaker Bhushan Power &amp; Steel Ltd.

Last week, the government announced a fresh capital infusion of about $10 billion into state banks and credit guarantees to support shadow lenders. Tens of billions of dollars of taxpayers' money has gone to the banks in the past four years. ($1 = 68.5500 Indian rupees)

One of India's biggest housing finance companies, Dewan Housing Finance Corp Ltd (DHFL), warned on Saturday that its financial situation was so grim that it may not survive.

One of India's biggest housing finance companies, Dewan Housing Finance Corp Ltd (DHFL), warned on Saturday that its financial situation was so grim that it may not survive. The company said it was "undergoing substantial financial stress" and its ability to raise funds was "substantially impaired and the business has been brought to a standstill with there being minimal/virtually no disbursements." "These developments may raise a significant doubt on the ability of the company to continue as a going concern," it said in notes accompanying results for the fourth quarter ending March 31, signed by Chairman and Managing Director Kapil Wadhawan. DHFL posted a net loss of 22.23 billion rupees ($324.3 million) during the quarter compared with a profit of 1.34 billion rupees in the same period a year earlier. DHFL separately announced on Saturday it had defaulted on interest payments worth 285.8 million rupees on non-convertible debentures, due on July 6 and July 8. The results are the latest sign of stress in India's banking and shadow lending sectors. The nation's state-owned banks have been burdened with bad debts for several years. Reforming and restructuring banks and shadow lenders so they can do more to finance economic growth is a major challenge for the government of Prime Minister Narendra Modi, who recently secured a second term in an election landslide. India's economic growth slipped to 5.8% in the January-March quarter, the lowest quarterly figure in more than four years. DHFL said it was talking to bankers and other lenders on restructuring its borrowings, was in discussions over the sale of its retail and wholesale portfolio and had also had talks with a potential strategic partner to take a stake. Provisions "The ability of the company to continue as a going concern is predicated upon its ability to monetize its assets, secure funding from the bankers/investors, restructure its liabilities and recommence its operations," it said in the notes. The results published late on Saturday were unaudited. It was not immediately clear why its auditors had not signed off. The audit committee had asked the board to submit audited stand-alone and consolidated financial results by July 22. The firm previously said it had delayed announcing results for the year to March 31 due to "unforeseen operational engagements." The reported loss was largely due to additional provisions related to an assessment of the fair value of its portfolio and for an expected credit loss, the firm said. Two major credit rating agencies - ICRA, an affiliate of Moody's Investors Service, and Standard & Poor's local unit Crisil - last month categorised DHFL's commercial paper at default levels for missing bond payments. The shadow banking sector has been in turmoil since September as Infrastructure Leasing and Financial Services (IL&FS), one India's largest non-banking financial firms, defaulted, sparking fear of contagion risk. IL&FS' series of debt defaults last year showed much of the sector was highly leveraged. The Reserve Bank of India, the country's central bank, is taking a more active role in scrutinising the sector. It said last month that the failure of a large non-banking financial company could cause as much damage as the collapse of a big bank. Adding to concerns about bad debts, Allahabad Bank on Saturday became the second Indian state-owned bank this month to report a major alleged fraud by bankrupt steelmaker Bhushan Power & Steel Ltd. Last week, the government announced a fresh capital infusion of about $10 billion into state banks and credit guarantees to support shadow lenders. Tens of billions of dollars of taxpayers' money has gone to the banks in the past four years. ($1 = 68.5500 Indian rupees)

Indian housing lender DHFL warns it may not survive as a going concern

<a href="https://www.wionews.com/business-economy/avoiding-temptation-rbi-likely-to-cut-key-rate-by-just-25-basis-points-207455">Reserve Bank of India</a> Governor Shaktikanta Das said the central bank would closely monitor the health of non-banking financial companies and it would not hesitate to take corrective measures, if needed, to address issues in the shadow banking sector.

"We will not hesitate to take any required steps to maintain financial stability in the short-, medium- and long-term," Das said in a speech on Saturday at a convocation ceremony in the western Indian city of Pune.

The comment comes at a time when there are fears that India may be facing a major crisis in its shadow banking sector after shares of Indian mortgage lender Dewan Housing Finance Corp Ltd (DHFL) plunged this week after two credit-rating firms cut their view of DHFL debt to "default" levels.

The looming trouble at DHFL comes nine months after a series of downgrades and defaults at another major NBFC, Infrastructure Leasing and Financial Services (IL&amp;FS), shook stock markets and stoked concerns of a malaise in the sector.

"<a href="https://www.wionews.com/business-economy/reserve-bank-of-indias-interest-rate-cut-in-monetary-policy-unlikely-to-stimulate-growth-report-224711">The Reserve Bank</a> will continue to monitor the activity and performance of this sector with a focus on major entities and their inter-linkages with other sectors," he said, in a speech that was published on the RBI's website late on Saturday.

The regulator will soon issue final guidelines for liquidity risk management and will put in place a comprehensive information technology framework to strengthen surveillance of NBFCs, the governor said.

Given the importance of NBFCs for the Indian economy, the governor stressed the need for a higher level of supervision of such companies to ensure solid credit growth and asset liability management.

Das said as part of initiatives to enhance supervision of NBFCs, the central bank is putting in place a system to ensure regular interaction with all stakeholders in the shadow banking value chain such as auditors, credit-rating agencies and banks.

The central bank on Friday issued new guidelines around the resolution of stressed assets after India's Supreme Court in April struck down its earlier guidelines saying it had acted beyond its powers.

The new rules "will sustain the improvements in credit culture" and help in making India's financial system strong and resilient, Das said on Saturday.

Das also urged Indian public sector banks (PSBs) to not depend solely on government capital infusions to solidify their balance sheets.

"Depending upon individual situations, PSBs should access the capital market for mobilisation of capital," he said.

Reserve Bank of India Governor Shaktikanta Das said the central bank would closely monitor the health of non-banking financial companies and it would not hesitate to take corrective measures, if needed, to address issues in the shadow banking sector.

Reserve Bank of India Governor Shaktikanta Das said the central bank would closely monitor the health of non-banking financial companies and it would not hesitate to take corrective measures, if needed, to address issues in the shadow banking sector. "We will not hesitate to take any required steps to maintain financial stability in the short-, medium- and long-term," Das said in a speech on Saturday at a convocation ceremony in the western Indian city of Pune. The comment comes at a time when there are fears that India may be facing a major crisis in its shadow banking sector after shares of Indian mortgage lender Dewan Housing Finance Corp Ltd (DHFL) plunged this week after two credit-rating firms cut their view of DHFL debt to "default" levels. The looming trouble at DHFL comes nine months after a series of downgrades and defaults at another major NBFC, Infrastructure Leasing and Financial Services (IL&FS), shook stock markets and stoked concerns of a malaise in the sector. "The Reserve Bank will continue to monitor the activity and performance of this sector with a focus on major entities and their inter-linkages with other sectors," he said, in a speech that was published on the RBI's website late on Saturday. The regulator will soon issue final guidelines for liquidity risk management and will put in place a comprehensive information technology framework to strengthen surveillance of NBFCs, the governor said. Given the importance of NBFCs for the Indian economy, the governor stressed the need for a higher level of supervision of such companies to ensure solid credit growth and asset liability management. Das said as part of initiatives to enhance supervision of NBFCs, the central bank is putting in place a system to ensure regular interaction with all stakeholders in the shadow banking value chain such as auditors, credit-rating agencies and banks. The central bank on Friday issued new guidelines around the resolution of stressed assets after India's Supreme Court in April struck down its earlier guidelines saying it had acted beyond its powers. The new rules "will sustain the improvements in credit culture" and help in making India's financial system strong and resilient, Das said on Saturday. Das also urged Indian public sector banks (PSBs) to not depend solely on government capital infusions to solidify their balance sheets. "Depending upon individual situations, PSBs should access the capital market for mobilisation of capital," he said.

Reserve Bank of India to enhance monitoring of shadow banking firms: governor