India

Reliance Capital Ltd., Anil Ambani’s financial services company, protested against a three-step downgrade by Care Ratings that put its credit score two notches above junk, Bloomberg News reported. Care Ratings cut the firm’s long-term debt program to BBB from A and kept it on credit watch with developing implications, according to statements from Reliance Capital and the rating company on Saturday.

India’s debt-ridden Infrastructure Leasing and Financial Services (IL&FS) said on Sunday that Japan’s Orix Corp has expressed an interest in buying out the remaining 51% stake in IL&FS’s wind energy assets, Reuters reported. Orix Corp plans to buy the stake to exercise its right under the terms of an existing agreement that allows Orix to match the price offered by the highest bidder for buying a stake in the wind power plants, IL&FS said.

India’s central bank said on Thursday that shadow banks with asset size of more than 50 billion rupees should appoint a chief risk officer in a move to tighten regulation after a series of defaults at top lender Infrastructure Leasing & Financial Services’ (IL&FS), Reuters reported. The government took control of IL&FS last year after its default triggered fears about contagion in India’s financial sector.

The government is open to providing more powers to the Reserve Bank of India (RBI) to direct lenders to take action on stressed assets, a senior finance ministry official told ET. There is a growing view in the government that there has to be some regulatory supervision over debt resolution by the RBI, The Economic Times reported. “It cannot be left to the discretion of banks — there has to be some regulatory supervision, and that should be from the banking sector regulator,” said the official.

Homebuyers and lenders of debt-laden Jaypee Infratech Thursday started voting on state-owned NBCC's bid to acquire Jaypee group's realty firm and complete the construction of over 20,000 flats, Business Standard reported. The voting process will end on Sunday and the outcome would be declared on May 20. The financial creditors would vote for the second time on the resolution plan for Jaypee Infratech, a subsidiary of Jaiprakash Associates Ltd (JAL). On May 3, the financial creditors rejected Mumbai-based Suraksha Realty's bid through voting process.

The chief executive and two other senior figures at Jet Airways have quit, the Indian company said on Tuesday, further eroding any hopes of a rescue of the debt-laden carrier that grounded operations last month, Reuters reported. Jet, once the biggest private carrier in the country, owes vast sums to its lessors, employees, fuel suppliers and other parties. It stopped all flights from April 17 after its lenders refused to give it any more funds to keep the carrier flying.

The National Company Law Appellate Tribunal (NCLAT) has decided to hear the Essar Steel insolvency case dispute on a daily basis for an early resolution, The Hindu Business Line reported. ArcelorMittal, the winning bidder, has been fighting to takeover the steel company for over one-and-half year but there is no sign of a resolution yet. Arguing on behalf of Essar Steel’s financial creditor Standard Chartered Bank (SCB) on Monday, senior advocate Kapil Sibal said ArcelorMittal’s bid is only ₹39,500 crore rather than ₹42,000 crore as claimed by the company in the Supreme Court.

Small borrowers with annual income up to ₹60,000 are likely to get automatic relief for any unsecured loans they are unable to repay, according to a new scheme for personal insolvency resolution that the government has prepared, Mint reported. The new scheme that will replace colonial era laws dealing with personal bankruptcy will also give breathing space to those who can repay loans. It will also protect some of their assets from dues recovery to help in their subsistence.

Lenders of debt-ridden dairy firm Kwality on Monday decided to carry out voting on extending the May 15 deadline for submitting the resolution plan by interested bidders, including Haldiram and Kotak group firm, sources said, Mint reported. The lenders would also vote on seeking extension of insolvency proceedings by 90 days, they said. As many as five companies -- Haldiram, Kotak fund, LVP Foods, Aion and TPG Capital -- have expressed interest to bid for acquiring Kwality.

The last stronghold in embattled tycoon Anil Ambani’s phone carrier-to-power empire is also developing fault lines. Reliance Capital Ltd., his financial services business that almost doubled its profit in five years, had largely remained insulated from the distress plaguing the wider conglomerate, Bloomberg News reported. Now, the company that controls India’s fifth-biggest mutual fund, is racing to close a planned $2 billion of asset sales to bolster its finances after cash dwindled to 110 million rupees ($1.6 million) as of March, according to CARE Ratings.