Comments
The current liquidity crunch is not a systemic problem and non-banking financial companies (NBFCs) are meeting payment obligations, top bankers said on Thursday. “All (NBFCs) of them have been able to meet their commitment as far as roll overs are concerned,” SBI Chairman Rajnish Kumar said on the sidelines of an event organised here.
Speaking on liquidity position in the banking system, National Bank For Agriculture And Rural Development (NABARD) Chairman H K Bhanwala said the condition is improving as interest rates are seen declining.
“So as such there is no big problem... Issue arose on account of some of entities which had borrowed short and created long assets. So, it may be specific problem. It does not seem to be a systemic problem,” Bhanwala said. Fears of liquidity crunch gripped the market following a series of defaults by group companies of IL&FS in the past two months. These led to concerns that non-banking lenders would be unable to meet their commitments for market borrowings, impairing growth.
He further said that various banks are supporting NBFCs, including Nabard which has an exposure of around Rs 15,000 crore. “(Our) total assets are Rs 4.80 lakh crore. Of this, the Rs 15,000 crore exposure to NBFCs is small. Nothing is at risk. I haven’t seen any default. Everybody is meeting the commitments to Nabard,” Bhanwala said.
On capital infusion from the government, he said Nabard has already received Rs 2,000 crore and it may not require more funds this year.
Comments
Comments
Comments have to be in English, and in full sentences. They cannot be abusive or personal. Please abide by our community guidelines for posting your comments.
We have migrated to a new commenting platform. If you are already a registered user of TheHindu Businessline and logged in, you may continue to engage with our articles. If you do not have an account please register and login to post comments. Users can access their older comments by logging into their accounts on Vuukle.