New Delhi: Within hours of getting new powers, the RBI on Friday made substantial changes in the norms for dealing with stressed loans and warned banks they will be penalised for missing NPA resolution timelines.
The RBI, through a notification, eased the decision making process in the Joint Lenders’ Forum (JLF) and Corrective Action Plan (CAP) under the ‘Framework for Revitalising Distressed Assets in the Economy’.
“To facilitate timely decision making, it has been decided that, henceforth, the decisions agreed upon by a minimum of 60 per cent of creditors by value and 50 per cent of creditors by number in the JLF would be considered as the basis for deciding the CAP...,” the notification said.
Earlier, the decision could have been taken by a minimum of 75 per cent of creditors by value and 60 per cent by number.
The RBI also warned that “any non-adherence to these instructions and timelines specified under the framework shall attract monetary penalties on the concerned banks...”.
As per the framework, banks are required to implement decision of the JLF within 90 days of the approval.
