PNB to sell its realty assets in central Delhi

Takes over five-star property in Bengaluru to recover dues

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In a bid to monetise its real estate portfolio, Punjab National Bank (PNB) plans to sell its real estate assets in central Delhi.

“At present, the bank’s units which are part of the headquarters are spread across various locations. PNB will relocate its headquarters to its new building in Dwarka, releasing the currently occupied space,” said Usha Ananthasubramanian, the public sector lender’s managing director and chief executive officer. The bank would also auction some its realty assets in Kanpur and Gorakhpur (Uttar Pradesh) and some properties in Kerala, she said on Friday during a conference call with analysts.

PNB is also planning to recover Rs 3,000 crore from among its bad loans by selling these to asset reconstruction companies (ARCs).

In the quarter ended June 2016, the bank recovered Rs 727 crore from these accounts up from Rs 217 crore in the year-ago quarter. For 2015-16, recovery from such accounts amounted to Rs 2,297 crore.

The PNB management expects to drive recoveries to a point where these are higher than slippages. The bank’s watch list stands at Rs 3,900 crore.

“The momentum is there for recoveries. This trend should set in the coming quarters. No one can say we are done with non-performing assets, but, more or less, the tapering has happened,” Ananthasubramanian added.

Meanwhile, the bank has taken physical possession of a five-star hotel property in Bengaluru, which is almost complete. PNB has exposure of Rs 110 crore to the developer of this property, which is slated to open in August this year.

“The physical possession of this property was to get the developer around to pay the dues. Some ARCs had evinced interested to buy this loan from us. But this being a near-complete property, it made sense for us to keep the exposure on the bank books,” said another PNB official.