Mumbai: The RBI on Friday sent debt-laden Dewan Housing Finance Corporation Limited (DHFL) to the bankruptcy tribunal, making it the first financial services company to be sent to the NCLT for a possible debt resolution after the government notified the rules for referring NBFC/HFC to the tribunal this month.
A few days back, the RBI had superseding the Board of DHFL and appointed an administrator on concerns over its corporate governance and defaults. The central bank has filed the application to begin insolvency proceedings against the mortgage lender with the Mumbai bench of the National Company Law Tribunal (NCLT).
An interim moratorium shall commence from the date of filing of the application till its admission or rejection, the central bank said in a statement.
As of July 2019, the third largest pure play mortgage lender owed Rs 83,873 crore to banks, the National Housing Board, mutual funds and bondholders, including retail bondholders. Of this secured debt is Rs 74,054 crore and unsecured debt is Rs 9,818 crore.
The government on November 15 had empowered RBI to refer stressed NBFCs and HFCs with assets worth at least Rs 500 crore to insolvency courts after notifying Section 227 of the Insolvency and Bankruptcy Code.