Banks identify Rs 89,000 cr NPAs to be transferred to NARCL

MUMBAI: Banks have recognized round 22 dangerous loans value Rs 89,000 crore to be transferred to the National Asset Reconstruction Company Ltd (NARCL) within the preliminary part, in accordance to MD and CEO Rajkiran Rai G.

Setting up of NARCL, the proposed bad bank for taking up harassed belongings of lenders, was introduced within the Budget for 2021-22.

“The Indian Banks’ Association (IBA) has asked lead banks to call for meetings and keep an approval ready so that as soon as the ARC is formed, they can start the process. I think the assessment in the first phase was of 22 accounts of about Rs 89,000 crore for the system,” Rai, who can also be the chairman of IBA, instructed reporters on Monday.

He stated banks have recognized the accounts the place there are nearly shut to 100 per cent provisions and are above Rs 500 crore in publicity.

“As banks, we have prepared the ground, identified accounts which can go to the ARC in the first phase and have arrived at this number,” he stated.

He additional stated the 22 accounts are these the place the lead banks have already performed conferences with different banks and acquired an in-principle approval to switch to the ARC every time fashioned.

“Once the ARC is formed, the management will look at these assets and only when they find that it is worthwhile buying, they will make an offer. Let us not pre-empt the decision of ARC to buy these assets,” he added.

When requested whether or not banks will have a look at transferring extra accounts after these 22 accounts, Rai stated, “Definitely. The initial estimate that this company can take is about Rs 2 lakh crore of bad loans. These numbers are the estimates of IBA and the banking industry and once the ARC is formed, those calls will be taken by it.”

The Rs 2 lakh crore of NPAs will go in phases, he stated.

Rai stated his financial institution is probably going to purchase a 9 per cent stake in NARCL. The lender has recognized 17 accounts value Rs 7,800 crore for transferring to the proposed dangerous financial institution.

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