RBI eases norms for flexible structuring of existing projects loans
Recently, Reserve
Bank of India (RBI) has issued a circular on Flexible Structuring of
Long Term Project Loans to Infrastructure and Core Industries. It may be mentioned that in
the circular, flexible structuring of project loans with the option of
periodic refinancing will be available only to new loans to
infrastructure projects and core industries projects sanctioned after
the date of the circular. In this context, banks have represented that
such flexible structuring of project loans with the option of periodic
refinancing may also be allowed to existing loans to infrastructure
projects and core industries projects, as it would ensure long term
viability of existing infrastructure/core industries sector projects by
aligning the debt repayment obligations with cash flows generated during
their economic life.
Accordingly, the Reserve Bank of India (RBI) has decided
to allow the banks to flexibly structure the existing project loans to
infrastructure projects and core industries projects with the option to
periodically refinance the same as per the specified norms. Further, a detailed note on the guidelines for “Flexible Structuring of Existing Long Term Project Loans to Infrastructure and Core Industries” is enclosed herewith for your ready reference.
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