New Delhi, March 13 State-owned MTNL has failed to deposit interest on sovereign guarantee bonds in the escrow account due on March 24 this year, the company said in a regulatory filing on Friday.
According to the structured payment mechanism of the Tri-Partite Agreement (TPA) signed among MTNL, the Department of Telecommunications (DoT), and Beacon Trusteeship Limited, the telecom company must fund the semi-annual interest into the escrow account maintained in Bank of India with an adequate amount 10 days before the due date, which in this case is March 24, 2026.
"In view of the above provisions of the TPA, it is informed that due to insufficient funds, MTNL could not fund the escrow account maintained in Bank of India with an adequate amount," the public sector telecom firm said.
MTNL stated that all bonds issued by MTNL are Sovereign Guaranteed Bonds by the center.
"In case of any default made by MTNL in the payment of Principal and Interest on the Bonds issued by it, then the Sovereign Guarantee will be invoked by the Debenture Trustee and the Government of India is obliged to make the payment to MTNL for the same," the filing said.