11 NPA resolutions to provide ` 1tr
New Delhi, May 20: Enthused by successful conclusion of Bhushan Steel case, the finance ministry expects banks to write back more than ` 1 lakh crore after the resolution of all 12 NPA cases referred to insolvency proceedings by the RBI it its first list.
Last week, Tata Group acquired controlling stake of 72.65 per cent in Bhushan Steel for around ` 36,000 crore will help in cleansing the banking system as well as boost lenders profitability.
The remaining 11 NPA cases which are in the pipeline will easily bring to the table over ` 1 lakh crore (` 1 trillion) and the amount coming from resolution under Insolvency and Bankruptcy Code ( IBC) will directly add to the bottomline and help in reduction of NPAs of the public sector banks, a senior finance ministry official told PTI.
Last year in June, RBI’s internal advisory committee ( IAC) identified 12 accounts, each having more than ` 5,000 crore of outstanding loans and accounting for 25 per cent of total NPAs of banks.
Following the RBI’s advisory, banks referred Bhushan Steel, Bhushan Power & Steel, Essar Steel, Jaypee Infratech, Lanco Infratech, Monnet Ispat & Energy, Jyoti Structures, Electrosteel Steels, Amtek Auto, Era Infra Engineering, Alok Industries and ABG Shipyard to NCLT.
These accounts together have total outstanding loan of ` 1.75 lakh crore.
The Kolkata Bench of the NCLT has already approved Vedanta’s resolution plan for acquisition of Electrosteel Steels last month. Besides, the NCLT last month also asked the lenders of Bhushan Power & Steel to consider the bid submitted by UK- based Liberty House for the debt- ridden company.
Bhushan Power and Steel owes close to ` 48,000 crore to banks and was referred to the NCLT by PNB in June last year.
Last week, Bamnipal Steel ( BNPL), a whollyowned subsidiary of Tata Steel, has acquired 72.65 per cent stake in Bhushan Steel by paying around ` 36,400 crore, of which ` 35,200 crore will be paid to financial creditors.
The buy- out is expected to bring relief in the form of capital boost to PNB that was one of the leading lenders to the debt- ridden company, the bank said.