Best option is to sell IL&FS along with group firms: Corp affairs secy

New Delhi : The best option to resolve the crisis created by Infrastructure Leasing & Financial Services (IL&FS) Ltd. defaulting on some of its debt obligations is to sell the company and its subsidiaries, said Injeti Srinivas, corporate affairs secretary, on Monday.

Another option is to separately sell the verticals and assets of the infrastructure financing and construction company, said Srinivas in Delhi.

The government took control of IL&FS in October, triggering wider concerns about risk in the rest of the country’s financial sector, particularly lenders’ exposure to what are known as non-banking finance companies (NBFCs).

Srinivas, who was speaking on the sidelines of an event, hinted as much, saying: “In the NBFC space, the housing finance companies are facing liquidity crunch.”

The government has pledged to ensure the beleaguered lender has the money to prevent further defaults, but Business Standard reported in November the company’s new board is discovering several challenges and complexities. The new board believes that large parts of the IL&FS group operated independently with no boundaries of legal entities and separate managements.

(Except for the headline, this story has not been edited by The Kashmir Monitor staff and is published from a syndicated feed.)