SBI chairman Rajnish Kumar has cautioned lenders against undertaking “selfish steps” without coordinating with other creditors involving a common borrower. Kumar was responding to a query on default by Altico Capital, a real estate NBFC lender, triggering concerns that the sector’s troubles are not over yet.
Without naming the lender or the borrower, Kumar said: “I do not have full details of this case, but all banks have to take steps in coordination with others. If any bank undertakes a selfish step, it can have a negative impact on other arrangements. This coordinated approach has been taken by lenders in two other NBFC accounts and it has worked.”He added; “You may have recovered a couple of hundred crores but if you end up damaging the system, it is not correct.”On September 3, India Ratings downgraded Altico Capital, which triggered an accelerated repayment clause on the company’s borrowings from a finance company. Fearing defaults, two other lenders — HDFC Bank and another private bank — marked a lien on the company’s fixed deposits, freezing Altico’s funds.