The Reserve Bank of India (RBI) has come up with a new scheme for Sustainable Structuring of Stressed Assets (S4A) of the large project. As per this new scheme, a portion of the debt will be converted into equity or other instruments under the supervision of Indian Banks Association, IBA’s Overseeing Committee. The Scheme for S4A will cover those projects which have started commercial operations and have an outstanding loan of over Rs 500 crore. The main aim of this new scheme is to strengthen the lender’s ability to deal with stressed assets and to put real assets back on track of entities facing genuine difficulties by providing an avenue for reworking financial structure.
The new scheme will be prepared by credible professional agencies in order to make sure that entire exercise is carried out in a transparent manner. Besides, an Overseeing Committee comprising of eminent experts will be set up by the Indian Banks Association (IBA) in consultation with the RBI. The committee will independently review the processes involved in the preparation of the resolution plan under the sustainable structuring of stressed assets.
So let’s discuss some questions related to this post :
1. The Reserve Bank Of India has announced a new scheme for the resolution of what?
2. The new scheme for S4A will cover the project of how much outstanding amount?
Courtesy: Times of India