L&T Fin Holdings creating Rs 10 bn corpus for unanticipated risks

Mumbai, 25 OctoberL&T Finance Holdings (LTFH) plans to build a corpus of Rs 10 billion in two to three years, as provision for future event risk. Dinanath Dubhashi, managing director, said the intent was to make provisioning of Rs 0.5-1 billion in each quarter. It had put aside Rs 1.1 bn for this in the September quarter, taking the overall macro-prudential provision to Rs 2 bn. For two segments -- Rs 1.5 bn rural and Rs 0.5 bn for housing.The intent is to have such provisions of 1.25 per cent of the total loan book. The corpus would be over and above the expected credit loss and standard asset provision, added Dubhashi.LTFH's provision coverage has also increased. The provision coverage ratio was 62.47 per cent at end-September, from 53.57 per cent a year before.About exposure to the IL&FS group, whose holding company and lending arm have defaulted recentlyh on payments, LTFH said it had no exposure to these entities. However, it has exposure to IL&FS Transportation ...

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