Finmin says first set of NPAs likely to be transferred to bad banks next month
The Finance Ministry on Monday said the Rs 6,000-crore National Asset Reconstruction Company (NARCL) or bad bank may acquire the first set of non-performing accounts of banks next month.
NARCL is a Special Purpose Asset Reconstruction Company for taking over large value NPA accounts (over Rs 500 crore) from banks.
In a series of tweets, the ministry said that Finance Minister Nirmala Sitharaman on Monday reviewed the progress in setting up NARCL.
The Minister was apprised of the progress achieved and noted the approvals/permissions received for both NARCL and IDRCL from the Government and the Regulators.
There are boards of both NARCL and IDRCL including MD.
“With the completion of account-wise due diligence, the first set of accounts are expected to be transferred during July 2022. The balance accounts are proposed to be taken up within the third quarter of the current financial year,” it said in a tweet. ,
Last month, NARCL had said that Natarajan Sundar has taken over as MD and CEO of Bad Bank.
NARCL holds shareholdings of 15 Indian lenders and Canara Bank Sponsor of this Asset Reconstruction Company (ARC).
Along with debt management company IDRCL, they are currently engaged in meeting the financial and legal reasons for the accounts identified for acquisition from the lenders. In September last year, the government issued a guarantee of Rs 30,600 crore for the security receipts issued by NARCL. was announced. The guarantee is valid for five years.
Banks have identified 38 NPA (Non-Performing Asset) accounts totaling Rs 82,845 crore, to be transferred initially to NARCL.
While public sector banks have taken majority stake in NARCL, India Debt Resolution Company Limited (IDRCL) will be owned by private sector banks. State Bank Of India, Union Bank of India And Indian Bank Each has taken 13.27 per cent stake in NARCL.