SBI prepared for the worst Telco distress
Rajnish Kumar, State Bank of India’s Chairman has said that SBI is prepared for the worst following the Supreme Court order asking telecom companies to immediately pay adjusted gross revenue (AGR) dues to the government. SBI has Rs 29,000-crore loan exposure to telecom, the largest among Indian banks.
Kumar said that their exposure to them is Rs 29,000 crore. After this order they will ask telcos what their plans are to comply with the order. He added that he expected the telcos to have identified “a course of action” as the order was known for some time.
So far, SBI has provided only for non-performing assets (NPAs) in its telecom loans. Besides the loans, SBI has an additional Rs 14,000 crore of non-fund exposure, which includes guarantees to the government, where the telcos have not defaulted.
Analysts had earlier expected that the government would provide relief to the telcos. The Centre is counting on Rs 90,000 crore of spectrum dues from Vodafone, which in turn owes banks Rs 30,000 crore. Given that the promoter’s investment in the company is Rs 15,000 crore there is a likelihood that Vodafone and Aditya Birla group will walk away.
See What’s Next in Tech With the Fast Forward Newsletter
Tweets From @varindiamag
Nothing to see here - yet
When they Tweet, their Tweets will show up here.