INSUBCONTINENT EXCLUSIVE:
sixth and last bimonthly money policy of the year on Thursday, but some of the policy measures announced by the central bank looked like
sector banks and MSMEs.
The central bank said it would not downgrade commercial real estate loans, if the delay is genuine
It will be in line with the treatment accorded to other project loans for the non-infrastructure sector
The central bank also said it would issue revised regulations for housing finance companies (HFCs ) by the end of February
the form of lowering costs for MSMEs and bringing some life into realty, wherein loans to commercial real estate will be considered as
Securities.
Modi further said RBI indeed used all its might to force banks to lower interest rates to induce transmission for the benefit of
end users, which it has partly achieved
New loans are now 69 basis points cheaper and old loans 13 basis points less costly after a total of 135 bps rate cuts in 2019.
Shares of
housing finance players including L-T Finance Holdings, Piramal Enterprises, LIC Housing Finance and HDFC rallied 1-10 per cent in Thursdays
On the other hand, the benchmark BSE Sensex ended the session 163 points higher 41,306.
Shares of select banks climbed up to 5 per cent,
after RBI announced measures to offer relief on retail loans for automobiles, residential housing and loans micro, small and medium
Shares of Canara Bank, Bank of Baroda, Indian Bank, Punjab National Bank gained 3-5 per cent, while stocks of real estate players like
Brigade Enterprises, Sobha, Indiabulls Real Estate advanced up to 4 per cent.
On policy rate, RBI opted for status quo after the Union
Budget for 2020-21 slipped on fiscal deficit target amid signs of hardening of inflation in an uncertain global environment.
The six-member
Monetary Policy Committee (MPC) headed by RBI Governor Shaktikanta Das kept repo rate unchanged at 5.15 per cent for the second meeting in a
real estate sector and further complementing many of the previous initiatives by the government in 2019, RBI has decided to extend the
restructuring of project loans by a year
Loans for projects that have been delayed for reasons beyond the control of their promoters have been extended by another one year without
downgrading the asset classification
This aligns with the treatment accorded to other project loans for the non-infrastructure sector
This is a big move and will bring the much-needed relief to the cash-starved real estate sector - and to both developers and the HFCs from
and managing cash flows for cash-strapped developers and help them complete several stuck projects