In order to revitalise distressed assets, the Reserve Bank of India introduced Joint Lenders Forum. JLF is a body consists of lenders/banks who have granted credit (loan) facility to concerned borrower. These guidelines will be applicable for lending under Consortium and Multiple Banking Arrangements (MBA).
Banks are advised that as soon as an account is reported by any of the lenders to CRILC as SMA-2, they should mandatorily form a committee to be called Joint Lenders’ Forum (JLF):
The JLF should explore the possibility of the borrower setting right the irregularities/weaknesses in the account. It may explore various options to resolve the stress in the account.
The options under Corrective Action Plan (CAP) by the JLF would generally include:
The JLF is required to arrive at an agreement on the option to be adopted for CAP within 45 days from
The JLF should sign off the detailed final CAP within the next 45 days from the date of arriving at such an agreement.
Wilful defaulters will normally not be eligible for restructuring.
This framework shall also be applicable to NBFCs
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