M&A

M&A

Public sector banks put Rs.39,671-Cr of bad loans up for sale again

Economic Times  

Public sector banks (PSBs) have initiated 36 sale processes for corporate bad loans with a principal outstanding of Rs.49,746-Cr during the first quarter of the current financial year. Of this pool, loans worth Rs.39,671-Cr, or nearly 80% of the total, comprise accounts that were previously offered to the market but remained unresolved. Indian Overseas Bank and Indian Bank account for 89% of the repeatedly offered loans.The assets consist of corporate and legacy accounts that lenders are attempting to offload to asset reconstruction companies to clean up their balance sheets. The concentration of these repeat offerings is even higher when calculated by total dues, which include accumulated interest, representing approximately 71% of the Rs.1.45 lakh-Cr block put up by state-owned lenders.While private sector banks also participated in the market, they reported a significantly lower proportion of repeat sale processes, with only 3.4% of their Rs.10,734-Cr pool consisting of previously offered accounts.