State Bank of India will acquire assets from cash-strapped nonbanking financing companies, or NBFCs, of up to 450 billion rupees, Press Trust of India reported Oct. 9, citing a statement from the bank.

NBFCs have been facing a liquidity crunch triggered by a series of debt repayment defaults by Infrastructure Leasing & Financial Services Ltd., or IL&FS, according to the report.

Indian Economic Affairs Secretary Subhash Chandra Garg said in a tweet that the bank's decision to buy assets would ease the companies' liquidity woes to a great extent.

In August, IL&FS defaulted on commercial papers, sparking concerns that it may trigger further losses among banks and mutual and pension fund managers.

State Bank of India initially planned to purchase 150 billion rupees of assets during the current fiscal year, but the lender's internal assessment revealed it could buy additional assets for about 200 billion rupees to 300 billion rupees, the report noted.

Managing Director P.K. Gupta said the increased target will benefit the bank with a sound portfolio, and allow NBFCs to receive much-required liquidity.

As of Oct. 9, US$1 was equivalent to 74.08 Indian rupees.