MUMBAI: Provident and pension fund trusts, which have jointly invested 'hundreds of crores' in bonds of the IL&FS workforce, have filed intervening petitions within the National Company Law Appellate Tribunal over fears that they may lose their money because the bonds come under unsecured debt.
The actual quantity at stake is not recognized since many of these are traded tools. However, funding bankers estimate it to be in hundreds of crores for the reason that infrastructure company's bonds - which have been 'triple A' rated - have been most popular via retirement budget that experience a low-risk urge for food but nonetheless need to get confident returns even when rates of interest are low.
According to resources, exempted trusts managing budget of workers of public sector companies corresponding to MMTC, IndianOil, CIDCO, HUDCO, IDBI, SBI, and electrical energy boards of Gujarat and Himachal Pradesh are among those who have filed petitions. There are also PFs of personal sector companies like Hindustan Unilever and Asian Paints.
In their programs, the budget are calling into question the solution process itself, including Section 53 of the IBC which spells out the order of priority for distribution of proceeds of the method.
The number of PFs filing petitions is likely to upward thrust since they have got till March 12 to make their software. So far, over 50 budget, managing retirement advantages of over 14 lakh workers, are understood to have exposure to IL&FS. When contacted, IL&FS spokesperson Sharad Goel mentioned the corporate would no longer comment on the issue.
The rapid cause of worry for buyers is IL&FS filing its workforce companies right into a three-tier classification of Green, Amber and Red.
The company has mentioned that of the 302 entities within the workforce, 169 are Indian companies. Of these, simplest 22 were identified to be able to fulfill all their tasks (Green). Another 10 companies can pay off their secured collectors (Amber) whilst 38 companies are distressed and can't meet their tasks (Red). The company mentioned that 100 entities are nonetheless being assessed. If fee is limited to secured collectors, simplest banks will obtain their dues whilst unsecured bondholders will likely be left prime and dry.
IL&FS has been a favourite among PFs because the company was noticed to be sponsored via the public sector, as it was promoted via giants like State Bank of India and Life Insurance Corporation of India.
Also, the corporate structured bonds to suit the necessities of PFs. Some really feel that with the solution taking place as regards to the Lok Sabha election, default to the PFs may just assume a political color.
The actual quantity at stake is not recognized since many of these are traded tools. However, funding bankers estimate it to be in hundreds of crores for the reason that infrastructure company's bonds - which have been 'triple A' rated - have been most popular via retirement budget that experience a low-risk urge for food but nonetheless need to get confident returns even when rates of interest are low.
According to resources, exempted trusts managing budget of workers of public sector companies corresponding to MMTC, IndianOil, CIDCO, HUDCO, IDBI, SBI, and electrical energy boards of Gujarat and Himachal Pradesh are among those who have filed petitions. There are also PFs of personal sector companies like Hindustan Unilever and Asian Paints.
In their programs, the budget are calling into question the solution process itself, including Section 53 of the IBC which spells out the order of priority for distribution of proceeds of the method.
The number of PFs filing petitions is likely to upward thrust since they have got till March 12 to make their software. So far, over 50 budget, managing retirement advantages of over 14 lakh workers, are understood to have exposure to IL&FS. When contacted, IL&FS spokesperson Sharad Goel mentioned the corporate would no longer comment on the issue.
The rapid cause of worry for buyers is IL&FS filing its workforce companies right into a three-tier classification of Green, Amber and Red.
The company has mentioned that of the 302 entities within the workforce, 169 are Indian companies. Of these, simplest 22 were identified to be able to fulfill all their tasks (Green). Another 10 companies can pay off their secured collectors (Amber) whilst 38 companies are distressed and can't meet their tasks (Red). The company mentioned that 100 entities are nonetheless being assessed. If fee is limited to secured collectors, simplest banks will obtain their dues whilst unsecured bondholders will likely be left prime and dry.
IL&FS has been a favourite among PFs because the company was noticed to be sponsored via the public sector, as it was promoted via giants like State Bank of India and Life Insurance Corporation of India.
Also, the corporate structured bonds to suit the necessities of PFs. Some really feel that with the solution taking place as regards to the Lok Sabha election, default to the PFs may just assume a political color.
Thousands of crores of PF money at risk due to IL&FS exposure
![Thousands of crores of PF money at risk due to IL&FS exposure]()
Reviewed by Kailash
on
February 14, 2019
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