Money & Banking

HDFC chief calls for one-time restructuring of some real estate loans

Our Bureau Mumbai | Updated on November 06, 2019

Deepak Parekh, Chairman, HDFC   -  BusinessLine

HDFC Chairman Deepak Parekh, on Wednesday, called for a one-time restructuring of certain real estate loans as a means to overcome the “current crisis of confidence” that has beset the housing finance and NBFC sector. “Personally, I do believe that we can overcome this crisis of confidence if lenders are allowed a one-time restructuring of certain real estate loans – particularly for stuck projects – where building approvals have been delayed,” he said, adding that if these restructured accounts are considered as standard assets for a period of 12 months or so, lenders will stop being so diffident.

Noting that critics may argue that this is just kicking NPAs down the road, Parekh said he has a different opinion. “But my stance is that real estate loans are different. The value of the land is always there,” he said.

Parekh also noted that there are pressing issues facing the Indian real estate market, and stressed that timelines of action will prevent further haemorrhage. “One cannot sugar coat the fact that there is pain and the trust deficit is clogging the flow of liquidity to where it is needed the most. There are developers who genuinely need last-mile funding,” he stressed, adding that we can’t afford a situation where “we cut off oxygen for even the stronger developers”, and this could happen if the risk averseness prolongs.

Published on November 06, 2019

Follow us on Telegram, Facebook, Twitter, Instagram, YouTube and Linkedin. You can also download our Android App or IOS App.

This article is closed for comments.
Please Email the Editor

You May Also Like