The Spreading Fire
Business Today|November 04, 2018

The government has brought in a new board to rescue crisis-ridden IL&FS. What can it do quickly to prevent further damage?

Anand Adhikari
The Spreading Fire
ARE YOU MY FRIEND OR ENEMY,” Ravi Ramaswamy Parthasarathy, or RP as he was called, often joked when asked about floating an IPO of the three-decade-old Infrastructure Leasing and Financial Services Ltd (IL&FS). Till a few months ago, this Mumbai-headquartered infrastructure financing institution was like a black hole. RP used to share information on a ‘need to know’ basis with the outside world. Today, this 1 lakh crore-asset size institution is threatening a contagion in the financial market.

Almost a decade ago, when the Lehman Brothers collapse created havoc across the world, India took pride in its banking regulator, the Reserve Bank of India (RBI). IL&FS is no Lehman, but has emerged as a ‘too big to fail’ institution. At stake is 91,000 crore of debt; nearly two-third of which is from banks. There are short-term commercial papers loaned by big mutual funds and insurers. It has 348 entities under its complex umbrella. This is more than the number of companies listed in the SME exchange. Many are questioning why IL&FS was allowed to continue as a private company for so long. It has marquee names like LIC and SBI as shareholders, Deloitte as auditor and eminent independent directors such as Maruti chairman R.C. Bhargava and former LIC chairman S.B. Mathur. Also, IL&FS was under RBI’s watch as a systemically important NBFC for the last seven years.

“The road towards mending the IL&FS mess is more complex than it looks,” reasons Uday Kotak, post the first board meeting after taking over as chairman of IL&FS. Kotak is among the half a dozen new directors who have been tasked to preserve the group’s value and prepare a roadmap. The immediate task is to prevent the contagion from spreading to the financial market.

هذه القصة مأخوذة من طبعة November 04, 2018 من Business Today.

ابدأ النسخة التجريبية المجانية من Magzter GOLD لمدة 7 أيام للوصول إلى آلاف القصص المتميزة المنسقة وأكثر من 9,000 مجلة وصحيفة.

هذه القصة مأخوذة من طبعة November 04, 2018 من Business Today.

ابدأ النسخة التجريبية المجانية من Magzter GOLD لمدة 7 أيام للوصول إلى آلاف القصص المتميزة المنسقة وأكثر من 9,000 مجلة وصحيفة.

المزيد من القصص من BUSINESS TODAY مشاهدة الكل
"Moving to cloud helped us grow❞
Business Today India

"Moving to cloud helped us grow❞

What was the problem you were grappling with?

time-read
1 min  |
November 24, 2024
She's Got Time
Business Today India

She's Got Time

MORE WOMEN ARE BECOMING WATCH CONNOISSEURS, SEEKING OUT BOTH JEWELLED AND TECHNICAL WATCHES FOR THEIR STYLE AND CRAFTSMANSHIP

time-read
3 mins  |
November 24, 2024
RISING STAR
Business Today India

RISING STAR

PARUL GULATI IS a name that's been steadily gaining prominence in the Indian entertainment industry after she appeared on season 2 of Shark Tank in 2023. She has become a multifaceted personality who effortlessly transitions between acting and entrepreneurship.

time-read
1 min  |
November 24, 2024
Building on a Legacy
Business Today India

Building on a Legacy

WHEN ZAHABIYA KHORAKIWALA stepped into her role as Managing Director of Wockhardt Hospitals over a decade ago, she confronted formidable challenges that have since turned into achievements.

time-read
1 min  |
November 24, 2024
LEADER IN INNOVATION
Business Today India

LEADER IN INNOVATION

AS FEDEX'S PRESIDENT (Middle East, Indian subcontinent and Africa), Kami Viswanathan has a lot on her plate.

time-read
1 min  |
November 24, 2024
WAITING IN THE WINGS
Business Today India

WAITING IN THE WINGS

Here are those who missed out as they have not yet completed a year in office; they'll be strong contenders in 2025

time-read
1 min  |
November 24, 2024
A DECENT PROPOSAL
Business Today India

A DECENT PROPOSAL

IN TODAY'S WORLD OF TRYING TO CREATE AN EQUITABLE SPACE, BOTH MEN AND WOMEN CONTRIBUTE TO THEIR HOUSEHOLDS. WOMEN ARE ENCOURAGED TO HAVE THEIR OWN SAVINGS POOL AND INVESTMENT ROUTINE. GIVEN THIS, HOW SHOULD FUTURE BRIDES APPROACH FINANCIAL PLANNING?

time-read
5 mins  |
November 24, 2024
Women and the STEM Bias
Business Today India

Women and the STEM Bias

EMPOWERING WOMEN IN STEM WILL NOT ONLY BENEFIT INDIVIDUALS, BUT ALSO STRENGTHEN THE ENTIRE INDUSTRY, DRIVING INNOVATION AND PROGRESS.

time-read
3 mins  |
November 24, 2024
ROCKET WOMEN
Business Today India

ROCKET WOMEN

WOMEN IN INDIA ARE NOT ONLY VENTURING INTO SPACE BUT ARE ALSO STARTING TO SPEARHEAD THE COUNTRY'S EFFORTS IN THE GLOBAL SPACE RACE.

time-read
6 mins  |
November 24, 2024
ONE STEP FORWARD
Business Today India

ONE STEP FORWARD

THE NUMBER OF WOMEN INDEPENDENT DIRECTORS IS GROWING STEADILY, BUT IT'S A LONG WAY FROM GENDER PARITY. MUCH MORE NEEDS TO BE DONE TO BREAK THE GLASS CEILING IN BOARDROOMS.

time-read
6 mins  |
November 24, 2024