Bad bank to kick off NPA takeover in July
2 years, 6 months ago

Bad bank to kick off NPA takeover in July

The Hindu  

The National Asset Reconstruction Company Ltd., set up to take over large bad loans of more than ₹500 crore from banks, will pick up the first set of such non-performing assets in July, the Finance Ministry said on Monday. The NARCL, which will acquire the bad loans from banks, and the India Debt Resolution Company Ltd. - which will then manage these assets and seek to enhance their value - have secured necessary approvals and permissions. “With the account-wise due diligence nearing completion, the first set of accounts is expected to be transferred during July 2022,” it said in a statement after a review by Finance Minister Nirmala Sitharaman. “The remaining accounts are proposed to be taken over within the third quarter of the current financial year,” it added The NARCL, whose formation was announced in the Union Budget for 2021-22, is intended to resolve stressed loans amounting to about ₹2 lakh crore, of which fully provisioned assets of about ₹90,000 crore are expected to be transferred to it from lenders in the first phase.

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History of this topic

Declaration Of Loan Account/ Debt As NPA Can Be Considered As Date Of Default To File Petition U/S 7 Of IBC: NCLAT
2 weeks, 4 days ago

Declaration Of Loan Account/ Debt As NPA Can Be Considered As Date Of Default To File Petition U/S 7 Of IBC: NCLAT

Live Law  

The NCLAT New Delhi bench of Justice Ashok Bhushan and Barun Mitra has held that upon declaration of the loan account/ debt as NPA that date can be reckoned as the date of default to enable the Financial Creditor to initiate action under Section 7 of the Code. There being default by the Corporate Debtor prior to 01.03.2020 and also …

NARCL, India’s Bad Bank, Facing Problems In Loan Transfers Due To Pricing, Liability Conflicts: Report
1 year, 4 months ago

NARCL, India’s Bad Bank, Facing Problems In Loan Transfers Due To Pricing, Liability Conflicts: Report

ABP News  

The National Asset Reconstruction Co Ltd is finding it difficult to acquire ‘bad loans’ from lenders due to conflicts about pricing and future liabilities. NARCL, often referred to as the ‘bad bank’ of India, is facing many problems in buying non-performing assets from lenders, banking and industry sources revealed to Reuters. The report quoted an anonymous banker and stated, “So …

‘Govt., RBI measures help banks recover bad loans worth more than ₹8.6 lakh crore in last 8 fiscal years’
2 years, 5 months ago

‘Govt., RBI measures help banks recover bad loans worth more than ₹8.6 lakh crore in last 8 fiscal years’

The Hindu  

Concrete steps taken by the government and RBI helped banks recover bad loans worth more than ₹8.6 lakh crore in the last eight financial years, the government informed Parliament on Monday. Several factors - including prevailing macroeconomic conditions, sectoral issues, global business environment, delayed recognition of stress by banks, aggressive lending during upturns, improper risk pricing and poor credit underwriting …

Decks cleared for bad bank to start
2 years, 10 months ago

Decks cleared for bad bank to start

Deccan Chronicle  

Mumbai: Decks have been cleared for India to have its own bad bank with all requisite approvals in place, including from the RBI. The bad bank, or the National Asset Reconstruction Company Ltd, will acquire bad loans from banks to help clean up their books, while the India Debt Resolution Company Ltd will handle the debt resolution process of these …

Explained | What is the need for a ‘bad bank’?
3 years, 3 months ago

Explained | What is the need for a ‘bad bank’?

The Hindu  

The story so far: The Union Cabinet on Wednesday approved a ₹30,600-crore backstop facility for guaranteeing securities to be issued by the National Asset Reconstruction Company Ltd., the so-called ‘bad bank’ that is being set up to help aggregate and consolidate lenders’ non-performing assets or bad loans. A ‘bad bank’ is a financial entity set up to acquire NPAs from …

Bad bank to get Centre's boost
3 years, 3 months ago

Bad bank to get Centre's boost

Deccan Chronicle  

New Delhi: The government on Thursday approved a proposal to provide Rs 30,600-crore government guarantee for security receipts issued by National Asset Reconstruction Company Limited, widely known as the “bad bank”, which will buy stressed loans of lenders. A ‘bad bank’ is a bank that buys the bad loans of other lenders and financial institutions to help them to clear …

Government sets up ‘bad bank’ to clear the NPA mess
3 years, 3 months ago

Government sets up ‘bad bank’ to clear the NPA mess

The Hindu  

Paving the way for a major clean-up of bad loans in the banking system, the Cabinet on Wednesday cleared a ₹30,600-crore guarantee programme for securities to be issued by the newly incorporated ‘bad bank’ for taking over and resolving non-performing assets amounting to ₹2 lakh crore. The Reserve Bank of India is in the process of granting a licence for …

IBA moves RBI, seeks licence to set up ₹6,000 crore NARCL
3 years, 4 months ago

IBA moves RBI, seeks licence to set up ₹6,000 crore NARCL

The Hindu  

The Indian Banks' Association has moved an application to the Reserve Bank of India seeking licence to set up a ₹6,000 crore National Asset Reconstruction Company Ltd or bad bank, according to sources. According to sources, the company, after mobilising an initial capital of ₹100 crore and fulfilling other legal formalities, has approached the RBI seeking licence to undertake asset …

CEA asks govt to end forbearance window for borrowers, pitches for setup of 'bad bank' to deal with NPAs
3 years, 10 months ago

CEA asks govt to end forbearance window for borrowers, pitches for setup of 'bad bank' to deal with NPAs

Firstpost  

Chief Economic Adviser KV Subramanian has made a strong case for setting up of a bad bank led by private sector to effectively deal with non-performing assets of the financial sector which may see a surge once regulatory forbearance to deal with the impact of COVID-19 is withdrawn. It’s important to also think about implementing the bad bank in the …

Explained: Why India's banks will face major NPA challenge in 2021
3 years, 11 months ago

Explained: Why India's banks will face major NPA challenge in 2021

India Today  

The coronavirus pandemic has had a devastating impact on banks and financial institutions around the world as the global economic crisis has led to a rise in defaults and bad loans. It also expects the Indian banking sector’s bad loans to shoot up to 10-11 per cent of the total loans as on March 31, 22 from eight per cent …

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