Lenders to Hotel Leela, a 5-star chain that is more than two months behind in payments on $700 million of debt, are likely to bite the bullet and amend the loan terms rather than declare it in default, say bankers involved in the talks, Reuters reported. Restructuring corporate loans - allowing banks to dilute payment terms without classifying loans as bad - is on the rise in Asia's third-largest economy, providing a lifeline to borrowers struggling in a sharp economic slowdown, but piling more stress on bank balance sheets.

A massive restructuring of debt in India's ailing textile sector will likely provide relief to thousands of mills struggling with losses and revive demand for cotton in the world's second-largest producer, industry officials said Wednesday, The Wall Street Journal reported.

India's mounting economic and political woes are prompting market players to raise the specter of a Greek-style crisis in Asia's third largest economy, Reuters reported on an International Financing Review story. This is not simply idle speculation. Last Friday, the rupee crashed to an all-time low against the dollar of 54.9 and it was stuck most of Tuesday at the psychologically significant Rs55/USD level, where the currency is seen as having no obvious technical support. And the implications of a rupee collapse would be immense.

Indian banks Monday discussed proposed changes to the corporate debt restructuring mechanism to minimize their losses and ensure that founders of stressed companies have skin in the game, the Deal Journal India blog reported. The mechanism is a formal process aimed at achieving an agreement between a stressed company’s lenders to restructure its debt. The proposals ranged from asking founders to issue personal guarantees and pledging entire holdings to requiring stressed companies to give creditors seats on their boards, said R.K. Dubey, executive director at Central Bank of India. Mr.

Singapore's privately held PhillipCapital Group said on Wednesday it has agreed to buy a majority stake in defunct broker MF Global's Indian unit, Reuters reported. PhillipCapital, which runs brokerage and asset management business across 13 countries, said it would plan to rename the business Phillip Securities India. No financial terms of the deal were disclosed and the transaction is still subject to regulatory approval. PhillipCapital said it will buy a majority stake in the joint venture between Sify Technologies and MF Global and has also agreed to buy the rest of the bankrupt U.S.

China intends to extend renminbi loans to other Brics nations, in another step towards the internationalisation of its currency, the Financial Times reported. The China Development Bank will sign a memorandum of understanding in New Delhi with its Brazilian, Russian, Indian and South African counterparts on March 29, say people familiar with their talks. Under the agreement CDB, which lends mainly in dollars overseas, will make renminbi loans available, while the other Brics nations’ development banks will also extend loans denominated in their respective currencies.

The head of AerCap Holdings NV said Wednesday that it repossessed two planes from India's Kingfisher Airlines Ltd., underscoring the challenges facing aircraft leasing companies after the collapse of as many as a dozen carriers so far this year, Dow Jones DBR Small Cap reported. Kingfisher has grounded planes and is seen by analysts as the next potential casualty of the tough industry environment that has already claimed large carriers such as Hungary's Malev and Spanair in Spain.

Loss-making Kingfisher Airlines Ltd. has made a fresh appeal to its lenders for additional loans of INR2 billion ($40.59 million), less than a fourth of what it had asked earlier, in another effort to solve its severe cash crunch problem, a senior executive at one of the lending banks said Saturday, Dow Jones DBR Small Cap reported. "Most of Kingfisher's banks have declared its debt a non-performing asset, so the airline has asked the few banks which have not," the executive told Dow Jones Newswires without elaborating. He did not wish to be identified due to confidentiality norms.

India's aviation regulator asked Kingfisher Airlines to explain why it has cancelled a large number of flights since Saturday, while the government again ruled out providing any aid to the loss-making carrier, Reuters reported. Kingfisher has cancelled 32 out of the 240 flights that it operates each day, the airlines said on Saturday, adding that it expected to return to full service within days.

Kingfisher Airlines said it is in talks with Hong Kong-based SC Lowy and some other investors to raise funds, as the financially beleaguered airline expedites steps to stay afloat. The discussions come at a time when Kingfisher, controlled by liquor baron Vijay Mallya, is struggling with depleting cash flow, high debt and unpaid bills. The financial troubles have forced the airline to cut dozens of flights, ground several planes, stop its low-fare operations and seek government help to sustain its business.