Standstill agreements by firms with bankers to delay the process of selling pledged shares have come under the Reserve Bank of India's (RBI) scanner, Business Standard reported.
According to the BS report, the sources said that the central bank is closely looking into the situation and could tighten the rules to discourage the bankers from entering such agreements.
The sources added that the top bank is looking to curb all forms of 'evergreening' of loans.
"The RBI has taken a serious view of the recent cases. The central bank has been particularly working hard to curb all forms of 'evergreening' of loans. We may tighten the norms so that lenders, especially non-banking financial companies (NBFCs), are discouraged from entering into such agreements with firms," a source was quoted as saying in the report.