Economics · Industrial Finance

What primary option did the traditional 'Convertibility Clause' provide to lending financial institutions in India?

Verified Solution4 OptionsUpdated: October 2026👁️1 View

1The option of converting a part of their term loans into equity shares of the borrowing company✓
2The option to convert their preference shares into high-yield debentures automatically
3The right to completely take over the management of a defaulting firm without a court order
4The right to demand immediate repayment of the full loan amount in foreign currency

Correct answer

The option of converting a part of their term loans into equity shares of the borrowing company

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