Union Minister of Finance Arun Jaitley on Monday said the government will take all measures to ensure adequate liquidity for non-banking financial companies, mutual funds, and small and medium enterprises.
Jaitley’s remarks come in the wake of stock markets witnessing a sharp plunge during intra-day trade on Friday over concerns of liquidity crisis being faced by some NBFCs.
The Reserve Bank of India and market regulator Securities and Exchange Board of India on Sunday they were closely monitoring the developments in the financial sector and were ready to take “appropriate actions” to allay fears of concerned investors, PTI reported.
State Bank of India’s chairperson Rajnish Kumar too said SBI will continue to lend to the NBFCs. “Some comments are being attributed to the SBI about the bank being wary of lending to NBFCs,” The Hindu quoted Kumar as saying. “The rumours are baseless. SBI lends support to NBFCs in private and public sector within the regulatory policy framework and will continue to do so.”
There have been liquidity concerns following default in repayment of loans by diversified IL&FS group. Another housing finance company, DHFL, too is reportedly facing liquidity crisis.