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IL&FS defaults on Rs 1,000-cr short-term loan from SIDBI

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Mumbai : Infrastructure Leasing & Financial Services (IL&FS) has reportedly defaulted on a multi-billion-rupee short-term loan from Small Industries Development Bank of India (SIDBI), according to a report. The report also says that the bank has asked one of its senior officials in the risk management department to resign over the loan default.

IL&FS has defaulted in repaying a short-term loan of Rs 1,000 crore to SIDBI. At the same time, a subsidiary of IL&FS too has defaulted in repaying loan worth about Rs 500 to the development financial institution, the report said. However, since SIDBI does not really have any security to invoke in its loan to IL&FS and the bankruptcy code as stated in the IBC does not apply to non-banking financial companies (NBFCs).