Reliance Capital to exit lending biz
Ambani said the group has over 60,000 crore of receivables stuck in regulatory and arbitration matters, which are pending for 5-10 years.
Mumbai: Reliance Anil Dhirubhai Ambani Group Chairman Anil Ambani on Monday said that Reliance Capital would be exiting all its lending businesses by December. Reliance Capital has two verticals, Reliance Commercial Finance and Reliance Home Finance. Reliance Capital will become a financial shareholder in these companies to re-converge shareholder value under new management and shareholding structure.
The two verticals have an asset size of over Rs 25,000 crore.
“As part of the transformation, Reliance Capital has decided that it will no longer be in the lending business. Both our lending businesses — Reliance Commercial Finance and Reliance Home Finance — are working closely with all our lenders and other stakeholders to finalise the resolution plans which are expected to be completed by December,” Ambani told the shareholders at the annual general meeting of Reliance Capital.
The effective debt of Reliance Capital will stand reduced by Rs 25,000 crore, Ambani said.
Ambani said the group has over 60,000 crore of receivables stuck in regulatory and arbitration matters, which are pending for 5-10 years. The group had repaid over Rs 35,000 crore in debt over the last 15 months and is close to repaying another Rs 15,000 crore by March 2020, despite nil funding from any bank, NBFC or financial institution.
Reliance Capital said it made interest and principal repayment of Rs 72.65 crore on Friday and Monday on a range of instruments, including non-convertible debentures, term loans and inter-corporate deposits. It said the company remained current on all its repayment obligations. The company completed 21.54 per cent stake sale in Reliance Nippon Life Asset Management to Nippon Life Insurance of Japan (Nippon) for Rs 3,030 crore, it said on Friday.