SBI to put 8 bad loan accounts under the hammer to recover Rs 39 billion

The State Bank of India (SBI) has put eight non-performing assets (NPAs), or bad loan accounts, on sale to recover over Rs 39 billion with the e-bidding auction process slated for later this month.

In a notification last week, SBI asked interested asset reconstruction companies (ARCs) and financial institutions to conduct the due diligence of the listed accounts which cumulatively owe the bank over Rs 39 billion.

Interested bidders are required to submit their expression of interest on e-bidding for these accounts which is slated to be held on September 26.

"In terms of the bank's revised policy on sale of financial assets in line with the regulatory guidelines, we place these accounts for sale to ARCs/banks/NBFCs/FIs, on the terms and conditions indicated," SBI said in the bid document posted on its website.

The bank's NPA accounts up for sale include Rohit Ferro Tech with the highest outstanding loan of Rs 13.20 billion, Indian Steel Corporation (Rs 9.28 billion), Jai Balaji Industries (Rs 8.59 billion), Mahalaxmi TMT (Rs 4.09 billion) and Impex Ferro Tech (Rs 2 billion).

The other defaulters' assets up for sale are Kohinoor Steel (Rs 1.10 billion), Modern India Concast (Rs 711.6 million) and Ballarpur Industries (Rs 471.7 million).

Of the gross NPAs worth Rs 10 trillion in the Indian banking system, those of the country's largest lender alone amount to over Rs 2 trillion at the end of June.

SBI reported a loss of Rs 48.76 billion for the first quarter ending June on account of provisioning for NPAs.