ICICI to sell Rs 1000cr NPAs from Tulip Tele, Falcon to ARCs

The largest private sector lender ICICI Bank has put two stressed assets with an exposure of Rs 1,000 crore on the block to be sold to asset reconstruction companies, market sources said today.
The two accounts include Tulip Telecom (Rs 700 crore) and Falcon Tyres worth Rs 300 crore. Both have been declared as non-performing assets for sometime now, they said.
All the major ARCs in the system have been approached for the asset sale, as per sources.
The bank had reported an increase in its gross non-performing assets ratio at 3.78 per cent in March 2015 and had said a bulk of NPAs are coming from assets restructured earlier.

The bank scrip closed 3.09 per cent down at Rs 291.20 apiece on the BSE.
It can be noted that since last fiscal, ARCs were not keen to pick dud loans from banks after the Reserve Bank asked ARCs to pay three times more upfront amount from 5 to 15 per cent of the asset value. Following this, there was a massive drop on fresh asset sales to/pick up by ARCs.

Last week, the new head of the country's oldest ARC Arcil had said he would be focusing on retail, SME assets and not banking assets and would also seek better pricing.

"Banks typically come up with auctions with a mixed bag of assets in it and ask and expect ARCs to buy those. We would prefer to have abilities to buy assets, either on industry preferences or on the basis of size or a little niche," Arcil's newly-appointed chief executive and managing director Vinayak Bahuguna had said here last week.
"We see a lot of opportunities in retail assets. Experience has shown that there is a higher rate of churn in these portfolios so capital can be churned faster. Therefore, it suits us to look at this particular asset base and try to grow that book and that Arcil would be very selective towards buying large corporate assets," he had said.