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Srei Group NBFCs Receive Two Bids Under IBC

In June, the Reserve Bank of India-appointed administrator for the two companies unearthed more than Rs 3,000 crore worth fraudulent transactions conducted over FY20 and FY21.

Loans involved with these fraudulent transactions were at Rs 2,512 crore, while the notional loss to the company stood at Rs 513.67 crore, the administrator had said in an exchange notification. The notional loss was on account of charging lower interest rates while lending to 14 companies.

Already a few lenders, including Union Bank of India and Punjab & Sindh Bank have classified the loan accounts as fraud.

The resolution process at Srei Group NBFCs has been ongoing since December 2020, much before the regulator initiated insolvency proceedings. The group had previously proposed to invite investments in Srei Equipment Finance from international private equity investors. But the plan did not materialise.

In October 2021, the two group companies were referred to insolvency resolution. Financial creditors have claims worth Rs 10,727.5 crore against Srei Infrastructure Finance and Rs 31,867.8 crore against Srei Equipment Finance.

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