**Summary:**
RBI Directive DBR.BP.BC.No.3721.04.048/2018-19, issued April 24, 2019, addresses disclosure requirements for Scheduled Commercial Banks and All India Financial Institutions (AIFIs) – EXIM Bank, NABARD, NHB, and SIDBI – regarding their exposure to Infrastructure Leasing & Financial Services Limited (IL&FS) and its group entities. This directive is prompted by the National Company Law Appellate Tribunal's (NCLAT) order dated February 25, 2019, which stipulates that financial institutions must obtain prior permission from the Appellate Tribunal before declaring IL&FS or its entities' accounts as Non-Performing Assets (NPAs). Banks and AIFIs are instructed to disclose, within their notes to accounts, specific information related to IL&FS and its entities. The disclosure should follow a proforma including: (1) total outstanding amount of exposures, (2) amount of exposures which are NPAs as per IRAC norms, (3) total provisions required to be held as per IRAC norms, and (4) provisions actually made and not classified as NPA. The responsible contact person at the Reserve Bank of India (RBI) is Dr. S.K. Kar, Chief General Manager.
Key Entities Referenced
Reserve Bank of India (RBI): The central bank of India, which issued the notification.
All Scheduled Commercial Banks: The target audience of the notification.
All India Financial Institutions (AIFIs): The target audience of the notification, including EXIM Bank, NABARD, NHB, and SIDBI.
EXIM Bank: Export-Import Bank of India, an All India Financial Institution.
NABARD: National Bank for Agriculture and Rural Development, an All India Financial Institution.
NHB: National Housing Bank, an All India Financial Institution.
SIDBI: Small Industries Development Bank of India, an All India Financial Institution.
Infrastructure Leasing & Financial Services Limited (ILFS): A core investment company that is the subject of the disclosure requirements.
National Company Law Appellate Tribunal (NCLAT): The appellate tribunal that issued an order regarding the classification of ILFS accounts as NPAs.
Dr. S.K. Kar: Chief General Manager at Reserve Bank of India.
RBI/2018-19/175
DBR.BP.BC.No.37/21.04.048/2018-19 April 24, 2019
All Scheduled Commercial Banks
All India Financial Institutions (EXIM Bank, NABARD, NHB and SIDBI)
Dear Sir/Madam,
Disclosure on Exposure to Infrastructure Leasing & Financial Services Limited
(ILFS) and its group entities
Please refer to the National Company Law Appellate Tribunal’s (NCLAT) order dated
February 25, 2019 in respect of I.A No. 620 of 2019 in Company Appeal (AT) No.
346 of 2018, in terms of which “no financial institution will declare the accounts of
‘Infrastructure Leasing & Financial Services Limited’ or its entities as ‘NPA’ without
prior permission of this Appellate Tribunal”.
2. In this context, banks and AIFIs are advised to disclose in their notes to accounts,
the information in the proforma given below.
Disclosure in respect of ILFS and ILFS entities.
Position as on ----------
(₹ in crore)
Amount Of (1), total Provisions Provisions actually
outstanding amount of required to be held
exposures which made as per IRAC
are NPAs as per norms.
IRAC norms and
not classified as
NPA.
(1) (2) (3) (4)
Yours faithfully,
(Dr. S.K. Kar)
Chief General Manager