SBI puts ₹1,580 cr worth of bad loans up for sale
State Bank of India (SBI) has initiated the process of selling R1,580 crore of bad loans to financial institutions including asset reconstruction companies (ARCs). The bank has put on block 11 non-performing assets (NPA) for sale through a bidding process, according to the tender on the bank’s website.
“Right now, interested parties are conducting due diligence. Once that is completed, the bidding process will take place later this month,” a person aware of the development said on condition of anonymity.
Last month, SBI put R3,554 crore of bad loans up for sale. In that auction, the bank received bids only for a portion of the total amount; SBI is awaiting final approvals to go ahead with the sale, said a second person, who also requested anonymity.
In the first half of fiscal 2018, the bank managed to sell R763 crore of bad loans to ARCs
“ARC sale has not been significant in these (first) two quarters. I think now, with Insolvency & Bankruptcy Code in the picture, the whole strategy, particularly around corporate cases, more and more probably get referred to the NCLT (National Company Law Tribunal),” Rajnish Kumar, SBI’s chairman, said in an earnings call on November 10.