 "Bandhan Bank sells over ₹6,800 crore stressed assets to ARCIL, Phoenix")
Bandhan Bank on Monday said it has sold stressed assets worth over Rs 6,800 crore to two asset reconstruction companies — Asset Reconstruction Company (India) Ltd (ARCIL) and Phoenix ARC — as part of efforts to reduce non-performing assets and sharpen focus on core lending.
What assets did Bandhan Bank sell to ARCIL?
The bank sold an unsecured non-performing asset portfolio that was over 180 days past due, with a principal outstanding of Rs 3,165.25 crore, to ARCIL for Rs 569.75 crore on a security receipt (SR) basis. ARCIL subscribed to 53.25 per cent of the SRs, while Bandhan Bank retained the remaining 46.75 per cent.
What was transferred to Phoenix ARC?
Separately, Bandhan Bank sold an unsecured written-off loan portfolio with a principal amount of Rs 3,707.11 crore to Phoenix ARC for Rs 331.97 crore. In this transaction, Phoenix ARC subscribed to 37.84 per cent of the SRs, while the bank retained 62.16 per cent.
How will these transactions impact the bank?
The transactions are expected to help Bandhan Bank clean up stressed assets on its balance sheet and strengthen its focus on core lending activities.