Bandhan Bank sells bad loans worth Rs 8,897 cr to ARC
Mumbai/IBNS: Bandhan Bank on Friday announced the sale of its stressed loans, worth Rs 8,897 crore, to an asset reconstruction company (ARC) for Rs 801 crore.
"The bank has transferred its group loan and small business agriculture loan (SBAL) technical written-off portfolio amounting to Rs 8,897 crores to an ARC, pursuant to Swiss challenge method, for a consideration amounting to Rs 801 crore, on security receipt consideration basis," it informed the stock exchanges.
"ARC along with investor has subscribed to 51.70 percent of security receipts amounting to Rs 414.04 crore, whereas, Bandhan Bank has subscribed to 48.30% of security receipts amounting to Rs 386.96 crore," the regulatory filing added.
The move to offload the stressed loans to an ARC was approved by the bank's board of directors on December 21.
A media report citing a source said that this is the first such sale by Bandhan Bank.
Under the Swiss challenge method, a bank invites bids receives bids on a pre-reserved price, and the highest bidder gets the portfolio.
Bandhan Bank had also written off micro-credit loans worth Rs 3,535 crore during the second quarter of the current fiscal.
IBNS
Senior Staff Reporter at Northeast Herald, covering news from Tripura and Northeast India.
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