The Reserve Bank of India superseded the board of SREI Infrastructure Finance (SIFL) and SREI Equipment Finance Limited (SEFL) owing to governance issues and payment defaults in meeting multiple payment obligations. The apex bank announced the move in a circular.
The circular further stated that former chief general manager of the Bank of Baroda, Rajneesh Sharma has been appointed administrator of the two entities.
"The Reserve Bank also intends to shortly initiate process of resolution of the two NBFCs under the Insolvency and Bankruptcy (Insolvency and Liquidation Proceedings of Financial Service Providers and Application to Adjudicating Authority), Rules 2019," the circular stated. Additionally, RBI said it would also apply to the National Company Law Tribunal for appointing the administrator as the insolvency resolution professional.
The announcement comes a week after creditors of the NBFC had rejected a proposal for a one-year standstill from any action for recovering dues estimated to be about Rs 35,000 crore. The banks with payments due had moved RBI for a resolution similar to DHFL.
