SBI to improve property auction process

The country’s largest lender, State Bank of India’s e-auction for properties worth Rs 1,200 crore failed to enthused investors. However, the public sector bank intends to conduct a repeat on a similar scale in each quarter, improving the bidding process and information disclosures.

SBI sold 124 of the 450 properties put through auction on an electronic platform, for about Rs 90 crore, said P K Malhotra, its deputy managing director (stressed assets management). He said the response for industrial and commercial properties was not up to expectation.

This was its first effort to hawk properties, taken as an outcome of loans gone sour, on a large scale. The quarter ending March, being the final one of a financial year, is crucial for recovering dues to bolster the bottom line. SBI had put offices, shops, factory buildings and residential apartments on the block, spread across 25 cities.

The auction was on Saturday, after a public notice on Thursday.Malhotra said there were three lessons from the process. One, more information has to be shared about industrial and commercial properties. Second, bidding has to be made easier. Finally, the bank also will have to address challenges like digital signatures and earnest money deposits to be paid by Indians abroad.

Some of the properties that did not find takers in this auction would be put for sale again in 2015-16, he said.