The Indian Renewable Energy Development Agency (IREDA) expects worsening of its asset quality with the Reserve Bank of India’s recent move to level the playing field on NPA recognition between State-owned NBFCs and private-owned ones.
It may be recalled that the central bank had earlier this year tightened the NPA recognition norms for banks and also brought NBFCs on par with them. It did not stop with that, but also ensured that state-owned NBFCs do not enjoy any advantage vis-a-vis private sector NBFCs as regards NPA recognition norms.
After the February 12 RBI circular, banks are mandated to categorise accounts that do not service their debt beyond 90 days as NPAs. Read More