22 NPAs worth Rs 89k crores identified to transfer to bad bank in first phase, confirms Indian Banks Association Chairman Rajkiran Rai G
As many as 22 bad loans worth Rs 89,000 crore have been identified by the banks to be transferred to the National Asset Reconstruction Company Ltd (NARCL) also called a bad bank in the initial phase, confirmed Indian Banks Association Chairman Rajkiran Rai G.
As many as 22 bad loans worth Rs 89,000 crore have been identified by the banks to be transferred to the National Asset Reconstruction Company Ltd (NARCL) also called a bad bank in the initial phase, confirmed Indian Banks’ Association Chairman Rajkiran Rai G.
According to a news agency Press Trust of India, Rai told reporters on Monday, “The Indian Banks’ Association (IBA) has asked lead banks to call for meetings and keep an approval ready so that as soon as the ARC is formed, they can start the process. I think the assessment in the first phase was of 22 accounts of about Rs 89,000 crore for the system.”
The proposed bad bank (NARCL) for taking over stressed assets of lenders were announced by the finance minister Nirmala Sitharaman in the Budget for 2021-22.
Rajkiran Rai G, who is also a Managing Director and Chief Executive Officer of Union Bank of India, said banks have identified the accounts where there are almost close to 100 per cent provisions and are above Rs 500 crore in an exposure.
“As banks, we have prepared the ground, identified accounts which can go to the ARC in the first phase and have arrived at this number,” he told to the reporters, PTI report said.
He further said the 22 accounts are those where the lead banks have already conducted meetings with other banks and got an in-principle approval to transfer to the ARC (asset reconstruction company) whenever formed.
“The management will look at these assets once the ARC is formed, and only when they find that it is worthwhile buying, they will make an offer. Let us not pre-empt the decision of ARC to buy these assets,” he added.
When asked whether banks will look at transferring more accounts after these 22 accounts, Rai said, “Definitely. The initial estimate that this company can take is about Rs 2 lakh crore of bad loans. These numbers are the estimates of IBA and the banking industry and once the ARC is formed, those calls will be taken by it.” The Rs 2 lakh crore of NPAs will go in stages, he said.
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