New Delhi: The country’s largest lender State Bank of India (SBI) will conduct auction of 12 non-performing accounts (NPAs) later this month to recover dues of over Rs1,325 crore. The e-auction of these accounts will take place on 25 June, according to an SBI notice.
The NPA accounts that have been put under the hammer include Ankit Metal & Power Ltd (Rs690.08 crore), Modern Steels Ltd (Rs122.61 crore), Good Health Agrotech Pvt Ltd (Rs109.14 crore), Amit Cottons Pvt Ltd (Rs84.70 crore), and Ind-Swift Ltd (Rs80.49 crore). The remaining are Nikhil Refineries (Rs52.85 crore), Bhaskar Shrachi Alloys (Rs51.48 crore), Sri Ganesh Sponge Iron Pvt Ltd (Rs38.96 crore), Asmita Papers (Rs37.23 crore), Forel Labs (Rs22.86 crore), Karthik Agro Industries (Rs20.82 crore) and Abhinandan Interexim (Rs14.15 crore).
SBI said interested bidders can conduct due diligence of these assets with immediate effect after submitting the expression of interest and executing a non-disclosure agreement with the bank.
The lender’s gross non-performing assets or bad loans as on 31 March, 2018, reached Rs2.23 trillion, which was 10.91% of gross advances by the end of 2017-18.
SBI reported a record net loss of Rs7,718 crore in the fourth quarter ended March, and of Rs6,547 crore for 2017-18 due to higher provisioning for bad loans. The net NPAs were Rs1,10,855 crore (5.73% of net loans) by end of March, 2018.
SBI said that the recovery in its written-off accounts improved to 21.18% in March quarter and the losses during the past fiscal were mainly because it was required to make provisions at a higher rates in respect of advances to stressed sectors of the economy.
The Reserve Bank’s revised framework has earmarked specified norms for early identification of stressed assets, timeline for implementation of resolution plans and a penalty on banks for failing to adhere to the prescribed timeline. These guidelines came after the banking sector regulator scrapped the previous mechanisms such as the corporate debt restructuring scheme, strategic debt restructuring scheme (SDR) and scheme for sustainable structuring of stressed assets (S4A).