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Case Study on Strategic Debt Restructuring: A Step to Revitalise the Distressed Assets in the Economy

ANWESH: International Journal of Management & Information Technology

Volume 3 Issue 1

Published: 2018
Author(s) Name: Veeralakshmi, A K Chaturvedi | Author(s) Affiliation: Associate Prof. & HOD, DOMS, College of Engg. Roorkee, School of Mgt., Roorkee, Uttarakhand, India.
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The leading financial sector problem at present in India is Non Performing Assets of public sector banks. Reserve Bank of India has initiated several steps; SDR (Strategic Debt Restructuring Scheme) is one among them. Mechanism of this scheme hovers around group of banks or Joint Lender Forum (JLF) committee comprises of the bankers who have lent loans to a stressed borrower. Condition for JLF initiative is being the non recovery of any money by a borrower during the last 60 days that is classified as the Special Mention Account 2. Corrective Action Plan (CAP) is working towards the restructuring of stressed assets. It also deals with the change of management or share transfer from the promoter to the banks. This step of RBI gives a strong footing to the banks to recover the debts and provide corrective shape. This empirical research paper is structured with the following objectives: 1. To understand the reasons of bad debts 2. To understand the viability of financial diversification 3. To analyse the sick unit framework 4. To assess financial implications on the lender 5. To critically evaluate the sample companies in the study To achieve above objectives researchers have used secondary data with the help of qualitative tools for analysis.

Keywords: Bad debts, Distressed assets, Economy, SDR.

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