Under this clause, both the debtor and creditor s shall agree to a legally binding 'stand-still' whereby both the parties commit themselves not to take recourse to any other legal action during the 'stand-still' period, this would be necessary for enabling the CDR System to undertake the necessary debt restructuring exercise without any outside intervention, judicial or otherwise.
However, the stand-still clause will be applicable only to any civil action either by the borrower or any lender against the other party and will not cover any criminal action.
Further, during the stand-still period, outstanding foreign exchange forward contracts, derivative products, etc. The borrower will additionally undertake that during the stand-still period the documents will stand extended for the purpose of limitation and also that he will not approach any other authority for any relief and the directors of the borrowing company will not resign from the Board of Directors during the stand-still period.
In case for any internal reason, any creditor outside the minimum 75 per cent and 60 per cent does not wish to commit additional financing, that creditor will have an option in accordance with the provisions of para 4. Exit Option 5. As stated in para 4. At the same time, in order to avoid the "free rider" problem, it is necessary to provide some disincentive to the creditor who wishes to exercise this option.
The exiting lenders may be allowed to continue with their existing level of exposure to the borrower provided they tie up with either the existing lenders or fresh lenders taking up their share of additional finance. The new lenders shall rank on par with the existing lenders for repayment and servicing of the dues since they have taken over the existing dues to the exiting lender.
In order to bring more flexibility in the exit option, One Time Settlement can also be considered, wherever necessary, as a part of the restructuring package. If an account with any creditor is subjected to One Time Settlement OTS by a borrower before its reference to the CDR mechanism, any fulfilled commitments under such OTS may not be reversed under the restructured package. Further payment commitments of the borrower arising out of such OTS may be factored into the restructuring package.
Category 2 CDR System 5. In other words, under the proposed second category of the CDR mechanism, the existing loans will only be restructured and it would be up to the promoter to firm up additional financing arrangement with new or existing creditors individually. The right of recompense should be based on certain performance criteria to be decided by the Standing Forum. Unlike in the case of CDR Mechanism, the operational rules of the mechanism have been left to be formulated by the banks concerned.
This mechanism will be applicable to all the borrowers which have funded and non-funded outstanding up to Rs. Major elements of this arrangements are as under: i Under this mechanism, banks may formulate, with the approval of their Board of Directors, a debt restructuring scheme for SMEs within the prudential norms laid down by RBI. Banks may frame different sets of policies for borrowers belonging to different sectors within the SME if they so desire. While assessing the realisable value of security, primary as well as collateral securities would be reckoned, provided such securities are tangible securities and are not in intangible form like guarantee etc.
However, for this purpose the bank guarantees, State Government Guarantees and Central Government Guarantees will be treated on par with tangible security. Non-agricultural cash credit accounts : In the case of non-agricultural cash credit accounts, the account should not be out of order any time during the specified period, for a duration of more than 90 days.
In addition, there should not be any overdues at the end of the specified period. Non-agricultural term loan accounts : In the case of non-agricultural term loan accounts, no payment should remain overdue for a period of more than 90 days.
In addition there should not be any overdues at the end of the specified period. All agricultural accounts: In the case of agricultural accounts, at the end of the specified period the account should be regular. Asset Classification of Restructured Accounts under the Guidelines.
AC during the specified one year period in case the unsatisfactory performance is established before completion of one year period. Treated as sub-standard w. Will migrate to 'Doubtful - one to three years' w. Skip to main content. Search the Website Search. Home Notifications. Background 1. Asset classification norms A part of the outstanding principal amount can be converted into debt or equity instruments as part of restructuring.
Advances classified as commercial real estate exposures ; The asset classification of these three categories accounts as well as that of other accounts which do not comply with the conditions enumerated in para 6.
The condition of being fully secured by tangible security will not be applicable in the following cases: a SSI borrowers, where the outstanding is up to Rs. CDR Standing Forum 2. Will migrate to 'Doubtful - more than three years' w.
Prudential Guidelines on Restructuring of Advances by Banks. Particulars of Accounts Restructured. Sacrifice diminution in the fair value. Period of delinquency as on the date of restructuring.
Asset classification AC on restructuring. Downgraded to 'Sub-standard' w. Asset classification after restructuring. The account performs satisfactorily as per restructured terms. If your qualifications meet our needs, a member of our talent acquisition team will contact you directly. History Contract — U. History Contract -U. Primary Purpose: LearningMate helps K organizations create digital content that is personalized, accessible, and engaging. Start Date: November End Date: November Hours per week: 10 — 25 Contract US Responsibilities: You will be responsible for providing support to the team and the stakeholders by identifying the requirements for developing a robust high school AP U.
Strong social science skills specialization or certification in U. The unrealized amount represents the balance due in a case settled through the intervention of the Indian Embassy, Foreign Chamber of Commerce or similar Organization;. The cost of resorting to legal action would be disproportionate to the unrealized amount of the export bill or where the exporter even after winning the Court case against the overseas buyer could not execute the Court decree due to reasons beyond his control;.
Bills were drawn for the difference between the letter of credit value and actual export value or between the provisional and the actual freight charges but the amounts have remained unrealized consequent to dishonor of the bills by the overseas buyer with no prospects of realization. The certificate shall also indicate that the export incentives, if any, availed by the exporter have been surrendered.
Exports made to countries with externalization problem i. The AD bank may allow set-off of outstanding export receivables against outstanding import payables, subject to the following conditions:. Set-off of export receivables against goods shall not be allowed against import payables for services and vice versa.
Further, set-off shall be allowed between the export and import legs taking place during the same calendar year. AD bank shall ensure that the terms of agreement are strictly adhered to;.
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