RBI said to seek details of banks’ exposure to Adani Group

Swiss lender Credit Suisse has stopped accepting bonds by Adani Group companies as collaterals for margin lending.

People wait to cross a road in front of the logo of the Adani Group installed at a roundabout on the ring road in Ahmedabad on February 2, 2023. | Photo Credit: Reuters

The Reserve Bank of India (RBI) has sought details from banks regarding their exposure to the Adani Group, banking sources said, a day after the conglomerate withdrew the ₹20,000-crore follow-on public offer (FPO) of Adani Enterprises amid the steep fall in its share price.

On Wednesday, Swiss lender Credit Suisse stopped accepting bonds by Adani Group companies as collaterals for margin lending.

The going has been tough for the diversified conglomerate over the past week ever since US-based short seller Hindenburg Research levelled a slew of allegations about the group’s operations, calling it the ‘biggest corporate con ever’. The Ahmedabad-headquartered group has denied all the allegations.

The RBI gets access to banks' large corporate borrowers on a regular basis as part of the central repository of information on large credits (CRILC) data base, the banking sources said.

Many a time bank lending takes place against pledged securities and a massive fall in the price of the equity shares of the Adani group's 10 listed entities could have accordingly lowered the value of the pledged securities.

There has been selling pressure in bank stocks since Hindenberg Research's report was released on January 24 as investors are concerned about the impact of the crisis on banks' books.

The country's largest lender SBI has said its exposure to the Adani Group was fully secured by cash-generating assets.

Last week, Life Insurance Corporation (LIC) has disclosed of having an exposure of ₹36,474.78 crore to Adani group's debt and equity, and added that the amount was less than one per cent of its total investments.