IL&FS defaults on Rs 10 billion short-term loan from SIDBI: Sources

This is probably the first time that a large financial institution has defaulted on a loan repayment, said banking sources.

Facing intense liquidity pressures, Infrastructure Leasing and Financial Services (IL&FS) has defaulted on a loan repayment to Small Industries Development Bank of India (SIDBI), according to sources.

They also said that the concerned SIDBI official in the risk management department was asked to go on leave on the issue of proper assessment of the risk on this exposure. 

Calls and messages from Business Standard to top executives at both IL&FS and SIDBI did not elicit responses. 

While the amount of default could not be ascertained, a Moneylife report said it was a short-term loan amounting to Rs 10 billion. 

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