INSUBCONTINENT EXCLUSIVE:
RBI and government have taken steps to support financing needs of the sector.Mumbai: The Reserve Bank of India (RBI) on Thursday relaxed
rules for non-banking financial companies (NBFCs) to sell or securitise their loan books, in a bid to ease persistent stress in the
sector.NBFCs can now securitise loans of more than five-year maturity after holding those for six months on their books, the Reserve Bank of
Earlier, they had to hold these assets for at least one year, a banker said.However, the relaxation on the minimum holding period will be
stress on their balance sheets after a debt crisis hit a large infrastructure funding company in September, triggering panic amongst
investors and a cash crunch in the sector.Following the massive volatility in the financial markets, the RBI and the government have taken
steps to ringfence the crisis and support financing needs of the sector, including providing additional liquidity to banks and credit
enhancement for refinancing needs.
