Data from Insolvency & Bankruptcy Board of India shows time taken to come up with a resolution plan is 2.5 times what it was 4 yrs ago. Recoveries are only about 1/3 of claim amounts.
Go First says its promoters have infused Rs 6,500 crore in airline since its inception & it has sought compensation of Rs 8,000 crore from engine maker Pratt & Whitney.
Covid induced backlog and secular crippling of the Adjudicating Authority’s functioning means we are fast approaching the pre-Code timelines for insolvency resolution, writes Ivan.
Insolvency and Bankruptcy Code is not immune to the shortcomings of India's justice system like delays despite being one of the key reform initiatives of the government.
RBI superseded boards of Srei Infra Finance and Srei Equipment Finance, and their insolvency process is expected to be IBC-like, as it was in DHFL’s case.
No two bankruptcies are the same, but India’s processes for handling them have some common deficiencies. It’s still not too late to turn the bankruptcy regime into a real institution.
After a brief debate by few members, the bill was passed with voice vote after which Rajya Sabha was adjourned for the day due to opposition's uproar over Pegasus among other issues.
Govt has enabled a mechanism via an ordinance under which MSMEs can continue operations using the resolution process without needing to shut shop or change management.
According to a statement by the airport, commercial operations likely to begin next year 'in view of the current construction status'. It was supposed to commence operations by 2024 end.
At interaction in Delhi Monday, Ambassador of Philippines also highlighted talks over possibility of high-level delegation visit later this year to mark 75 yrs of diplomatic ties.
Changed reality for Modi govt in its 3rd innings is by no means rise of a new phenomenon. It's a return to old normal where even majorities had to routinely wrestle with storied million mutinies.
This column is quite shallow and avoids a few key areas where data should have been collected and presented. Increasingly IRP is becoming a rent-seeking profession and together with increased timelines, the columnist should have tracked “loading” of IRP fees in the process. Recently there have been many instances of leading creditors, including banks, challenging expenses incurred by IRP. This data should be easy to get.
Also grapevine talks about “collusion” between IRPs and insolvent parties where “qualifying criteria” for auctions are kept to ensure friendly bidding.
As a result, most creditors today are preferring to go for a bilateral settlement.
In a real estate company case I know of, a particular project’s creditors wanted to dissociate and complete the project in partnership with another builder, but were refused to do so by the IRP. Case is dragging on and asset quality declining, making it lose-lose for everyone but the IRP and the delinquent.
IBC can be reformed by making IBC remuneration fixed, timelines defined and maybe a variable based on recovery % to align with creditor interests. Unless this beast is tamed, creditors have little incentive in getting caught in what is currently a blackhole.
This column is quite shallow and avoids a few key areas where data should have been collected and presented. Increasingly IRP is becoming a rent-seeking profession and together with increased timelines, the columnist should have tracked “loading” of IRP fees in the process. Recently there have been many instances of leading creditors, including banks, challenging expenses incurred by IRP. This data should be easy to get.
Also grapevine talks about “collusion” between IRPs and insolvent parties where “qualifying criteria” for auctions are kept to ensure friendly bidding.
As a result, most creditors today are preferring to go for a bilateral settlement.
In a real estate company case I know of, a particular project’s creditors wanted to dissociate and complete the project in partnership with another builder, but were refused to do so by the IRP. Case is dragging on and asset quality declining, making it lose-lose for everyone but the IRP and the delinquent.
IBC can be reformed by making IBC remuneration fixed, timelines defined and maybe a variable based on recovery % to align with creditor interests. Unless this beast is tamed, creditors have little incentive in getting caught in what is currently a blackhole.