INSUBCONTINENT EXCLUSIVE:
months after infrastructure financier ILFS Group defaulted for the first time in June last year, investor confidence has again been shaken
this week by signs that the crisis is spreading among shadow banks
the worst hit in the wake of the ILFS shock, which pushed up financing costs and made it harder for non-bank financing companies to access
the bond market, is major mortgage lender Dewan Housing Finance Corp
Its shares plunged 11.5 per cent on Thursday.
The pain in the shadow banking sector poses a challenge for Indian economic growth that has
already slowed to a five-year low
Nerves have already been rattled by defaults at Jet Airways India Ltd
and debt concerns at conglomerate Essel Group.
Crisil cited delays in debt servicing payments at Dewan Housing that were due on June 4 on
some non-convertible debentures because of inadequate liquidity
The company has been on a spree to sell its assets including a mutual fund and education loan company.
That echoes moves at Indian tycoon
following what the rating firm called "delays/default" in debt servicing due to a slowdown in the collection from debtors.
Shares of Eros
slid 20 per cent in India to the lowest since 2010.
