INSUBCONTINENT EXCLUSIVE:
ILFS appointed Vineet Nayyar as its managing director.The government's measures to resolve liquidity issues facing Infrastructure Leasing
Financial Services (ILFS) are timely and appropriate, said the Reserve Bank of India (RBI) on Friday
"The measures taken by government are apt and RBI will also engage with the new management of ILFS, if necessary, on assistance in its
efforts going forward," said RBI Governor Urjit Patel
Government's measures on ILFS will help stabilise the situation, he added.ILFS is a major infrastructure finance and construction company,
which has built up big debts and is now facing a credit crunch
The government replaced the company's entire board on Monday after recent defaults on some of its debt obligations triggered declines in
stock and debt markets, leading to concerns about broader risk in the country's financial sector.ILFS appointed Vineet Nayyar as its
managing director, and Uday Kotak as its new non-executive chairman this week.Earlier on Thursday, Finance Minister Arun Jaitley said that
there had been "significant impact" on the capital market on account of the contagion effect of the ILFS problem which had prompted the
government to replace the board."The government is determined to make sure that since this is an internal factor to India, this should be
contained quickly so that no adverse impact is left," Jaitley said.The ILFS Group, especially its subsidiaries ILFS Engineering and
Construction Company (ILFS Engineering) and ILFS Transportation Networks, entered into major problems beginning 2012, the government had
infrastructure projects even before 2014.Meanwhile, the RBI opted for a surprising status quo at the fourth bi-monthly policy review on
repo rate unchanged at 6.5 per cent
Meanwhile, rupee breached the 74-mark against US dollar for the first time on Friday.(With inputs from agencies)
