June 11, 2019 / 12:59 PM / a year ago

DHFL clears interest on NCDs, to seek rating upgrade

A bird flies past a signboard of Dewan Housing Finance Corporation Ltd. (DHFL) outside its office on the outskirts of Mumbai, India, January 31, 2019. REUTERS/Francis Mascarenhas

BENGALURU (Reuters) - Indian mortgage lender Dewan Housing Finance Corp Ltd (DHFL) on Tuesday said it had cleared interest of 9.61 billion rupees due on non-convertible debentures (NCDs), a week after it delayed payments and fanned fears of a liquidity crisis.

DHFL is part of the country’s shadow banking sector which has been struggling since a series of defaults at lender Infrastructure Leasing and Financial Services Ltd last year.

Last week, rating agencies ICRA and CRISIL downgraded DHFL’s commercial paper to their lowest level after it missed payments on bonds.

The company also said on Tuesday it will seek rating upgrades from agencies now that it had cleared all its dues on NCDs.

In May, DHFL stopped taking new deposits and blocked premature withdrawals following a credit rating downgrade as the National Housing Bank, which regulates mortgage finance companies, does not allow firms to raise deposits if they do not have an investment grade rating.

($1 = 69.4176 Indian rupees)

Reporting by Chandini Monnappa in Bengaluru; Editing by Rashmi Aich

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