Money & Banking

DHFL defaults on ₹225-crore unsecured commercial papers

Our Bureau Mumbai | Updated on June 25, 2019 Published on June 25, 2019

A bird flies past a signboard of Dewan Housing Finance Corporation outside its office in Mumbai   -  REUTERS

Troubled Dewan Housing Finance (DHFL) on Tuesday said it has defaulted on unsecured commercial paper of ₹225 crore and it will be paid over the next few days. The payment was due on Tuesday.

“Of the ₹375 crore aggregate amount, ₹150 crore, that is 40 per cent, has been paid on proportionate basis, and the balance amount of ₹225 crore shall be paid in next couple of days,” DHFL said in a regulatory filing, adding it will be paid once the surplus cash flow position improves over the next couple of days.

DHFL further said it is already in the process of selling down its loan assets including wholesale project loans to make good all its obligations and maintain its 100 per cent commitment to all its creditors as it has done since the liquidity crisis started in September 2018.

It further said since September 2018, it has met liability obligations of more than ₹41,000 crore.

“Without any recourse to fresh debt funding, a situation exacerbated by multiple rating downgrades, the company met all its financial obligations through a combination of internal accruals, sell down of its loan assets and monetisation of non-core assets,” it said, adding that pursuant to the downgrade by rating agencies expecting a default for the commercial papers (CP) much before they had fallen due, the mutual funds had already taken a 100 per cent markdown on their CP investments.

It said that despite the downgrades, it has continued to meet its obligations of CP holders and made good a total of ₹375 crore of CPs before Tuesday.

Published on June 25, 2019
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