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RBI sends debt-ridden DHFL to Bankruptcy Tribunal
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RBI sends debt-ridden DHFL to Bankruptcy Tribunal

Agency News

The Reserve Bank on Friday sent the crippled Dewan Housing Finance Corporation (DHFL) to bankruptcy tribunal, making it the first NBFC/HFC to be resolved under the insolvency and bankruptcy code (IBC). Earlier, the Reserve Bank of India had already superseded the board of debt-laden DHFL.

The move by RBI after the Centre on November 15 empowered the Central Bank to refer stressed NBFCs and HFCs having assets worth at least Rs. 500 Crore to insolvency court.The central bank also said there will be an interim moratorium on the lender between the date of filing of the bankruptcy application and its admission or rejection.

The central bank also said there will be an interim moratorium on the lender between the date of filing of the bankruptcy application and its admission or rejection. The city-headquartered pure play mortgage lender becomes the first NBFC/HFC to go for bankruptcy resolution. R. Subramaniakumar, ex-MD and CEO of Indian Overseas Bank had been appointed as the administrator.

DHFL is one of India's top defaulters and owes close to Rs.1 lakh crore to its debtors, which include banks and mutual funds.