In a brazen attempt at preventing its loan from being classified as a non-performing asset, the State Bank of India has just sanctioned Rs130 crore to Ispat Industres, adjusting Rs30 crore against earlier dues!

Yesterday Moneylife wrote how an acute cash crunch has forced Ispat Industries to close nearly all its plants, including the 3.3 million steel unit at Dolvi, Maharashtra. However, banks and financial institutions flush with funds, have been eager to help the company generously, no matter that a whole steel boom has come and gone without the slightest change in the fortunes of the company, its shareholders and its bankers.

Shockingly, even as the mill has remained closed from 3rd November and the bourses have not been informed (read: http://www.moneylife.in/article/4/11805.html), Moneylife learns that Ispat has got a fresh loan of about Rs130 crore from State Bank of India (SBI). We gather that of this amount, Rs44 crore has been used to pay overdue electricity charges, Rs30 crore towards excise duty, Rs30 crore for customs duty and demurrage, while an arm of SBI has taken away a part of what the bank has given the company. It appears that SBI has adjusted Rs28 crore against its earlier dues. For more visit: Moneylife.in

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