New Delhi, Dec 26 (SocialNews.XYZ) Finance minister Nirmala Sitharaman may meet heads of public sector banks (PSBs) on December 28 to review status of bank credit growth, credit to non-banking finance companies (NBFCs), the MSME sector credit, other bottlenecks and the recent Insolvency and Bankruptcy Code (IBC) amendments.
Official sources said on Thursday that the meeting will take stock of mainly of NBFC liquidity and credit growth.
The Union cabinet on Tuesday cleared an ordinance to amend the Insolvency and Bankruptcy Code (IBC) that would ring-fence successful bidders from criminal proceedings against offences committed by previous promoters.
"The amendment will remove certain ambiguities in the Insolvency and Bankruptcy Code, 2016, and ensure smooth implementation of the Code," a cabinet statement said.
Earlier this month, the Finance Ministry said that public sector banks (PSBs) have disbursed loans worth Rs 2.39 trillion in November to non-bank lenders, large and small businesses, as well as farmers, and Rs 2.52 trillion in October, for a total of Rs 4.91 trillion in the two months.
This data was cited by the government to show the revival of credit flow and the success of its loan programmes, aimed at boosting consumption in a slowing economy.
"PSBs being adequately capitalized and record recovery underway, have sufficient liquidity to support credit growth," it said.
RBI's 6 December fortnightly data on credit growth of commercial banks, however, showed that PSBs (including non-state ones) have seen incremental credit growth of Rs 89,605.52 crore (including food credit) and Rs 58,386.5 crore of non-food credit between 27 September and 22 November. RBI gives loan disbursements net of repayments by borrowers in the same period.
Recently, the cabinet approved a partial credit guarantee scheme for PSB to purchase high-rated pooled assets from financially sound NBFCs and housing finance companies.
PSBs can purchase high-rated pooled assets from financially sound Non-Banking Financial Companies (NBFCs)/Housing Finance Companies (HFCs), with the amount of overall guarantee provided by government till the first loss of up to 10 per cent of fair value of assets being purchased by banks or Rs 10,000 crore, whichever is lower.
-IANS
ana/bc
( 357 Words)
2019-12-26-19:57:01
Source: IANS
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