Banks Get $7.6 Billion Boost From India Bankruptcy Recovery

  • Court makes sudden progress in resolving four pending cases
  • Windfall gain may be overshadowed by further rise in bad loans
A customer uses an automated teller machine at a State Bank of India branch at night in Bengaluru, India.Photographer: Karen Dias/Bloomberg
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India’s banks are set for a $7.6 billion earnings windfall this month as the country’s bankruptcy court has made sudden progress in clearing a backlog of large cases.

The lenders are expected to benefit from the recovery process from four failed companies -- Essar Steel India Ltd., Prayagraj Power Generation Co., Ruchi Soya Industries Ltd. and RattanIndia Power Ltd. -- which should be completed in December, according to people familiar with the matter.