The Reserve Bank of India (RBI) is reportedly examining the utilisation of sanctioned bank loans to Adani Group companies. As per a news report, the central bank is scrutinising this in order to determine the Gautam Adani-led firm’s dependency on domestic lenders.
According to a Livemint.com report, the RBI is examining this primarily to take a note of how much the Adani Group companies are relying on domestic lenders for funding their operations and expansion plans.
It adds that some RBI supervisors overseeing some banks are also reportedly requesting for Adani group loan data twice weekly. This includes details on both sanctioned fund-based and non-fund-based limits and their utilisation. Before this, media reports also surfaced that suggested that the RBI was closely monitoring Adani’s bank loans post Hindenburg crisis.
At this point when many experts are considering the impact of Adani vs Hindenburg crisis on India’s banking sector, the report mentions that the RBI wants to use this as a proxy for an stress in the group that could potentially affect the sector.
“RBI is looking very closely at whether the group is drawing more funds from banks. These are not fresh loans but are limits already sanctioned by lenders. The regulator has not said how long we have to keep submitting this data,” Livemint.com quoted a banker as saying.
Recently, the RBI also reviewed and stated that India’s banking sector so far, remains resilient and stable. It also added that all these banks were also largely in compliance with the large exposure framework guidelines issued by the central bank.
For the unversed, in February, the RBI in its post Monetary Policy Committee (MPC) media briefing also stated that it was closely monitoring the Indian banking sector. However, it must be noted that the central bank’s representatives did not specifically name any company while answering media queries.