The consortium of 31 lenders to the troubled Dewan Housing Finance (DHFL) are meeting Thursday to discuss a resolution plan for the third largest pureplay mortgage lender, sources said Wednesday.
The lenders, which had last met on July 1, are still in the process of signing an inter-creditor agreement for the company, a must to decide on a resolution plan under the June 7, revised NPA circular from of the monetary authority.
"The meeting is to discuss and decide on a resolution plan for DHFL," a senior banker told PTI.
At the July 1 meeting, lenders had decided to sign the inter-creditor agreement by July 5 but could not do so yet.
"The process signing the mandatory inter-creditor agreement is still on. A majority of the banks have signed the agreement," said another banker.
According to the Reserve Bank's revised framework for NPA resolution, dated June 7, if a borrower is reported to be in default by any of the lenders, other lenders should undertake a review of the account within 30 days from the default, which will be called as review period.
During the review period, banks may decide on a resolution plan and wherever a plan has to be implemented, all lenders will have enter into an inter-creditor agreement within those 30 days to provide for ground rules for finalisation and implementation of a resolution plan.
The Wadhawan family, who owns a little over 39% in the company, has been looking at various ways of coming out of the stress which first came to light late last year following the IL&FS bankruptcy. These include selling stakes in group entities, inclduing in the flagship to the extent of giving up half of their stake.
DHFL has seen a rash of rating downgrades last month after it defaulted on ₹1,150 crore to its bondholders due on June 4. This led to a downgrade of its ₹850-crore commercial papers to 'default' by three rating agencies.
Following this on June 11, it had paid ₹962 crore of the ₹1,150 crore debt towards interest on NCD repayment, but again on June 25, it failed to fully redeem another CP worth ₹225 crore.
DHFL owes nearly ₹90,000 crore to banks and other financial institutions, according to its FY18 annual report.
Meanwhile, DHFL denied reports in a section of the media that Deloitte has resigned as its auditor.
When contacted a company spokesperson said, "these are absolutely unfounded rumours."