BackSBI to auction seized property worth Rs1,000 crore
The auction will put 350 residential and commercial properties across 26 locations in India on the block
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Mumbai: State Bank of India (SBI) will auction property worth at least ₹ 1,000 crore that it has seized from defaulters in the biggest ever exercise conducted by the country’s largest lender.
“We go for auctions on a regular basis but this would be the first time that we are doing such a large auction on a national level," said Parveen Kumar Malhotra, deputy managing director and group executive, stressed asset management group, SBI.
Most banks in India have been struggling with recoveries.
The ratio of recoveries and upgrades to gross NPAs in the December quarter at state-owned banks was 14%, compared with 40% in the June quarter, according to data collated by ratings company Icra Ltd. Gross NPAs at public banks rose from 4.6% of advances on 30 June to 5.1% on 31 December, Icra said in a report on 19 February.
The auction planned by SBI will be concluded online through three e-auction web sites—Magicbricks.com, e-Procurement Technologies Ltd and C1 India Pvt. Ltd.
“From a recovery point of view, this seems to be a very cost-effective and transparent move from the bank. If everything goes well and there aren’t too many procedural hassles, this could very well be a trendsetter for other banks too," said Ashvin Parekh, managing partner, Ashvin Parekh Advisory Services Llp, a financial advisory firm.
“We will pursue all modes of recovery available to us," he said.
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