In the first tranche of 15 large ticket stress loans worth over 50,000 crore will be transferred to the National Asset Reconstruction Company NARCL by the end of March 2022 for resolution.
The lenders have identified 38 accounts with aggregate loans of Rs 83,845 crore, which have been identified for transfer, according to Dinesh Kumar Khara, Chairman of State Bank of India, in Mumbai on Friday.
This is a scaled down target to compared to Rs 2 trillion to NARCL, also called as the "Small Target", which is scaled down to compared to Rs 2 trillion to be given to NARCL.
Asked about a downward revision in the estimates, Khara said that some of the accounts listed for transfer have been resolved and accounts declared as fraud are not included in the list of accounts to be transferred. SBI chairman said that how much would be acquired up by NARCL is moving target, as per the resolutions b banks.
NARCL and Indian Debt Resolution Company Ltd IDRCL have received approval from Reserve Bank of India and both entities are ready to start the business.
Lenders would get upfront 15 per cent cash and 85 per cent in form of security receipts backed by a guarantee from the government of India.
The approval for NARCL was granted under Section 3 of the Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest SARFAESI Act 2002.
State-owned banks, including State Bank of India SBI Union Bank of India, Punjab National Bank PNB and Indian Bank, have a majority stake in the NARCL. The private sector will hold a majority stake in the debt resolution company.
SBI has sent two officials to head IDRCL -- Padmakumar Madhavan Nair, as managing director and chief executive NARCL and Manish Makharia.