Mumbai: Reliance Home Finance said on Saturday that maturity of certain non-convertible debentures of Rs 400 crore has been extended till October-end in view of the continuing severe liquidity crisis in the sector
The decision has a formal written consent of the concerned debenture trustees and non-convertible debenture holders, it said.
Non-convertible debentures are fixed-income instruments which cannot be converted into shares or equities. Extension of maturities by mutual consent is a recognized global practice to deal with severe dislocations in capital markets and does not constitute a default.
“The extension of maturity has been made purely to address timing mismatches in receipt of proceeds from the on-going monetization of retail asset pools of the company,” said the company in a statement.
“Reliance Housing Finance has already monetized over Rs 5,000 crore of retail assets and will continue to do so to meet its debt servicing obligations.”
The company said that housing finance sector is dealing with an extraordinary situation where all categories of lenders in the country have completely frozen new lending to private sector companies for nine long months, leading to a severe adverse impact on economic growth and a potential systemic threat to the stability of the Indian financial system.