Bankers are struggling to arrive at a consensus on the resolution of several stressed power sector assets outside of the insolvency proceedings. They fear large loan losses or haircuts in the sector given the lower valuations.
“Negotiations are going on but we are yet to finalise the pricing as the current levels demanded by buyers will lead to huge hair-cuts for us. Even if the assets are pushed to NCLT (National Company Law Tribunal), the assets will not fetch much value,” said a senior banking source.
A haircut is a banking parlance used for losses on the principal loan given to the borrowers. Read more
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