RBI has encouraged banks to look at asset reconstruction companies as a supportive system to deal with the rising NPA menace
GN Bureau | May 2, 2014
With a view to relieve themselves from the mounting pressure of the bad loan pile, a number of public sector banks (PSBs) is hoping to sell about Rs 2,000 crore of these loans to asset reconstruction companies.
According to media reports, the various banks working on offloading bad loans include – UCO Bank (Rs 1,000 crore), State Bank of Hyderabad (Rs 700 crore), and Canara Bank and State Bank of India which are selling off smaller portions to asset reconstruction companies (ARCs).
The move, which comes in the beginning of this fiscal, is a first in almost 10 years and reflects the urgency at PSBs to get rid of bad loans. Earlier, banks sold off loans to ARCs only towards the end of the fiscal in order to present clean balance sheets.
According to analysts quoted in media reports, banks are undertaking this step to benefit from the one-time dispensation facility given by the Reserve Bank of India (RBI) on sale of such loans. Under this facility, if banks sell assets to ARCs below the net book value, losses incurred due to this can be amortised over two years up till March 2015.
In addition, RBI has encouraged banks to look at ARCs as a supportive system to deal with stressed assets instead of dumping NPAs there as a last resort.
With the commissioning of the third unit of the Prayagraj Super Thermal Power Project (PSTPP), Bharat Heavy Electricals Limited (BHEL) has successfully executed the 1,980 MW coal-based supercritical thermal power project in Uttar Pradesh. The first two units of the project
The ministry of electronics and information technology (MEITY) will set up a new body, Digital India Corporation (DIC), to execute prime minister’s ambitious Digital India programme. The corporation will subsume some of the existing agencies within the ministry including the National e-Gove
While India and China are pitted against each other in South Asia and the Southeast Asian region, and the former’s refusal to participate in Beijing held summit on One Belt One Road (OBOR) initiative was a low point in their bilateral ties, New Delhi is now preparing an initiative that will r
The existing Pragati Maidan complex is set to get a new face with its redevelopment into a world class state-of-the-art integrated exhibition-cum-convention centre (IECC). CMD, India Trade Promotion Organisation (ITPO), L C Goyal and CMD, NBCC (India) Limited, Anoop Kumar M
GAIL (India) Limited has registered 57 percent rise in profit after tax (PAT) for the 2016-17 fiscal with the PAT increasing to Rs 3,503 crore from Rs 2,226 crore in the last fiscal. The rise in profit was boosted mainly by a turnaround in the company’s petrochemical
A senior bureaucrat, apparently much respected among the administrative circles, faces two years in jail. His crime: a decision that may have come from the political leadership. HC Gupta, a former coal secretary, is among the three bureaucrats convicted b