In a bid to ease the stress in the banking system on account of rising non performing loans, the government is planning to launch a fund that would invest in stressed assets.
In a bid to ease the stress in the banking system on account of rising non performing loans, the government is planning to launch a fund that would invest in stressed assets.
“We are working towards creating a stress assets fund. We need an efficient resolution and recovery process for banks for many of their stress assets,” said Jayant Sinha, minister of state for finance, while addressing repor-ters on the sidelines of an event organised by credit rating agency CRISIL in Mumbai.
While noting that the non-performing assets (NPA) have touched '8 lakh crore, Mr Sinha said the government is working towards efficient resolution and rec-overy process through which non-performing loans could be brought down to sustainable levels. He further informed that the government has already set up a committee that is working on it.
“We expect a variety of funds — stressed debt fund, special situations fund, and NIIF (National Investment and Infrast-ructure Fund) — to then participate in equity investment in these stressed assets,”MoS finance said.
“There are many other players looking into stress assets. We will have a significant stressed assets fund. We expect there will be a vibrant market to be able to take these assets that are in need of equity capital right now and to bring them back to a high-quality operating performance. We are in the process of working that out,” Mr Sinha added.
