Banks have started classifying loans to Future Retail Ltd (FRL) as a “non-performing asset” after the company missed payments to them, Banks told the Supreme Court in a filing. The lenders also said they would need $1.07 to $1.2 billion in their books because of the default by the country’s second-largest retailer.

“Lenders have already begun classifying the loan account of FRL as a non-performing asset (NPA) since the payment was not made within the stipulated time”, they said in the filing. Being classified as an NPA will raise financial troubles for FRL. Citing its dispute with Amazon, Future last month challenged its lenders in the Supreme Court to avoid facing insolvency proceedings or being classified as a defaulter after it missed making certain payments on its loans. Future has told Indian stock exchanges that it was unable to pay $470 million to the lenders on Dec 31 as it could not sell certain small stores amid the row with Amazon.