The government on this Monday stated that it is going to ensure the needed liquidity is arranged for the IL&FS that is trapped in debt in order to prevent any such defaults in payments of loans that is made by the non-financial institute.
On a particular day, Mumbai-bench of NCLT permitted the government to take control over the board of IL&FS. According to the Finance Ministry, this step was important in order to ensure confidence in the financial market. It is also hoped that the financial organizations will offer the NBFC liquidity.
The ministry also stated that there is an urgent to prevent any further financial defaults. It is also important to take steps in order to solve the defaulted dues to the claimants. In order to make this happen, it requires a set of measures of restructuring certain liabilities, asset sales and also the fresh collaboration of the funds by the lenders and the investors. The ministry also added that the confidence of the financial market in the credibility of the company and the IL&FS management is required to be restored.
Despite the liquidity crisis, the company still continued to pay large managerial payouts and dividends. According to the statement, this clearly shows that the management is left of no total credibility.