SBI MF has written off its entire exposure to Reliance Home Finance.
The fund house’s 12 schemes had an exposure of Rs 800 crore in RHF. In June, SBI MF had taken 75% haircut on its exposures to RHF’s debt papers.Last Friday (November 29), the fund house wrote off the rest 25% or Rs 200 crore exposure in RHF’s debt papers.
Explaining what prompted this write off, SBI MF said in a public note that RHF continued to default on its payment obligations and no resolution has been finalised under an Inter Creditor Agreement (ICA) framework.
The fund house’s release noted, “The exposures of our schemes are in secured debentures maturing on January 03, 2020 issued under a public issue of debentures. As per the terms of our Debenture Trust Deed, SBI MF called a meeting of debenture holders in the public issue on November 14, 2019.”
“Accordingly, a resolution of all secured NCD holders in the public issue was passed calling an Event of Default on November 19, 2019. IDBI Trusteeship Services Limited, which is the debenture trustee for the public issue called for acceleration of dues giving the issuer 7 days for payment, which expired on November 26, 2019. The company has failed to make repayment as per the resolution passed by the secured debenture holders.”
Following the write off, NAV of a couple of schemes - SBI Dual Advantage Fund-Series XVIII and SBI Debt Fund Series C-1 – fell by more than 2%. The fund house has noted that any recovery from the investment in RHF will be credited to the schemes in the proportion of their initial holdings.
Scheme Name |
Issuer name |
Rating |
Price at which the security is valued (% of Face Value) |
Price as per the valuation agencies (% of Face Value) |
Impact of deviation on scheme NAV in amount terms (Rs.) |
Impact of deviation on scheme NAV of 28.11.2019 in % terms |
SBI Equity Hybrid Fund |
RHFL 08.70% (Series I Cat I & II) 03-Jan-2020 |
CARE D |
0 |
25 |
25,00,00,000 |
0.08% |
SBI Magnum Children's Benefit Fund |
RHFL 08.70% (Series I Cat I & II) 03-Jan-2020 |
CARE D |
0 |
25 |
75,00,000 |
1.15% |
SBI Credit Risk Fund |
RHFL 08.70% (Series I Cat I & II) 03-Jan-2020 |
CARE D |
0 |
25 |
6,25,00,000 |
0.12% |
SBI Credit Risk Fund |
RHFL 08.90% (Series I Cat III & IV) 03-Jan-2020 |
CARE D |
0 |
25 |
31,25,00,000 |
0.61% |
SBI Debt Hybrid Fund |
RHFL 08.70%(Series I Cat I & II) 03-Jan-2020 |
CARE D |
0 |
25 |
6,25,00,000 |
0.57% |
SBI Debt Hybrid Fund |
RHFL 8.90%(Series I Cat III & IV) 03-Jan-2020 |
CARE D |
0 |
25 |
2,50,00,000 |
0.23% |
SBI Dual Advantage Fund-Series XVIII |
RHFL 08.90% (Series I Cat III & IV) 03-Jan-2020 |
CARE D |
0 |
25 |
21,25,00,000 |
2.21% |
SBI Dual Advantage Fund-Series XXII |
RHFL 08.70%(Series I Cat I & II) 03-Jan-2020 |
CARE D |
0 |
25 |
50,00,00,000 |
1.77% |
SBI Dual Advantage Fund-Series XXII |
RHFL 08.90%(Series I Cat III & IV) 03-Jan-2020 |
CARE D |
0 |
25 |
12,50,00,000 |
0.44% |
SBI Debt Fund Series C-1 |
RHFL 08.90%(Series I Cat III & IV) 03-Jan-2020 |
CARE D |
0 |
25 |
2,37,50,000 |
2.06% |
SBI Dual Advantage Fund-Series XXIII |
RHFL 08.70%(Series I Cat I & II) 03-Jan-2020 |
CARE D |
0 |
25 |
16,75,00,000 |
0.66% |
SBI Dual Advantage Fund-Series XXIII |
RHFL 08.90% (Series I Cat III & IV) 03-Jan-2020 |
CARE D |
0 |
25 |
26,87,50,000 |
1.06% |