Morgan Stanley Says Indian Financials at Inflection Point
- Top court’s ruling on ArcelorMittal positive for banks: Desai
- NSE Nifty Bank Index up 15%, edging toward an all-time high
India's supreme court in New Delhi.
Photographer: Sajjad Hussain/AFP via Getty Images
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India’s banking sector may witness a turnaround, after recent rule changes put banks in a better position to get their money back from insolvent companies, according to Ridham Desai, managing director at Morgan Stanley India Co.
A Supreme Court ruling last week not only paved the way for ArcelorMittal’s purchase of Essar Steel India Ltd., an Indian steel mill, but also allowed banks to set the terms of the distribution of sale proceeds among creditors. The move to empower banks “has settled several disputes” around India’s bankruptcy law introduced in 2016, Desai said at a conference in Singapore on Thursday.