Bankers to Bhushan Steel Review Action Plan for Recovery

Mumbai: A consortium of 51 lenders to the cash-starved Bhushan Steel, which owes more than Rs 40,000 crore to banks, today took stock of the implementation of an action plan that would lead to the recovery of loans.

 

"The agenda of the meeting was to have an update on implementation of the corrective action plan given by lenders," said a banker who attended the meeting.

 

As many as 51 banks led by Punjab National Bank (PNB), State Bank of India (SBI), Bank of India, Bank of Baroda and IDBI Bank among others have a total exposure of about Rs 40,000 crore in the company.

 

The largest lender SBI has over Rs 6,000 crore exposure to the Delhi-based company, which faced trouble after its vice-chairman and managing director was arrested in a bribery case.

 

Last August, Bhushan Steel Vice Chairman and Managing Director Neeraj Singhal was arrested by the CBI in an alleged cash-for-loan scam involving the then Syndicate Bank chairman and managing director S K Jain, who was later suspended by the government.

 

After the arrest, lenders formed a committee with officials from various banks, which are closely monitoring the functioning of the company. They had also appointed some new directors to the company's board.