January 6, 2017 / 4:10 AM / a year ago

Toshiba to meet banks Tuesday, loan waiver expected - sources

TOKYO, Jan 6 (Reuters) - Toshiba Corp plans to meet with creditor banks on Tuesday to explain how it is addressing a massive charge the company says it must take on its U.S. nuclear business, two bankers briefed on the meeting said.

The bankers told Reuters they expect creditors will agree not to call in loans while they discuss steps to aid the laptops-to-engineering conglomerate.

Toshiba officials could not immediately be reached for comment.

Syndicated loans could be endangered because credit-ratings downgrades put Toshiba in violation of loan covenants, the bankers said, adding that it was routine for them to grant a waiver in such a case to avoid a funding crisis.

Toshiba, still recovering from a $1.3 billion accounting scandal in 2015, shocked investors again last month by announcing cost overruns at a U.S. nuclear business bought in 2015 which could now mean a charge against profit that could top $4 billion. (Reporting by Taiga Uranaka, Editing by William Mallard and Himani Sarkar)

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