Lenders refuse to recast Websol Energy System’s Rs.350-crore loan 

Allahabad Bank CMD Shubhalakshmi Panse.
Photo: Deccan Chronicle

According to a report published in a leading financial daily, a consortium of seven lenders has refused to refer the Kolkata-based Websol Energy System to the corporate debt restructuring (CDR) cell for the recast of its loans worth Rs.350 crore, said people familiar with the matter in the banking industry. 

The move assumes significance in light of the repeated warnings by the government and the RBI on the rising incidence of bad loans, prodding banks to act tough on defaulting companies. 

The said report says, Allahabad Bank Ltd (Rs.89.25) has a total exposure of around Rs.115 crore while Exim Bank lent about Rs.60 crore. The company took mostly working capital loans from private sector lenders , including Axis Bank Ltd (Rs.114.90) for about Rs.70 crore, Federal Bank Ltd (Rs.78.05) for about Rs.35 crore, Rs.25 crore from ICICI Bank Ltd (Rs.1045.25) and around Rs.5 crore from HDFC Bank Ltd (Rs.652.15).

Therefore, the biggest beneficiary seems to be Allahabad Bank Ltd from the deal, though Axis Bank and Federal Banks Ltd, would also get some gain from the move.