State Bank of India (SBI) on Wednesday put on sale non-performing assets (NPAs) worth Rs 989 crore of 15 different entities and sought bids from asset reconstruction companies (ARCs) on a cash basis or through a mix of cash and security receipts (SRs), according to a sale document.
One of the loans on the block is SBI’s Rs 158.57-crore exposure to Simbhaoli Sugars, a company being probed by the Central Bureau of Investigation (CBI) with respect to an alleged case of bank fraud.
Bidding will be held on the bank’s e-auction platform. According to the sale document, for each of the assets, the bid with the highest cash component shall be considered as the successful bid. “The auction for financial asset no 15, viz, Jagadambha Cotton Industries P Ltd is under swiss challenge method, based on an existing offer in hand, who will have the right to match the highest bid,” it said.
Interested parties must submit an expression of interest (EoI) before March 9. The due-diligence exercise will be completed by March 22 and the process of e-bidding will be held on March 23.
Ten of the accounts on sale, worth `528 crore, are those of Ahmedabad-based companies. Six among these are from the textiles sector.
This is the second time in as many months that SBI has put its NPAs on sale. On February 16, it had put on sale loans worth Rs 1,936 crore of 24 different entities.
A new mechanism for resolution of stressed assets, which came into effect on March 1, holds banks to a time-bound recognition and resolution of NPAs. As a result, banks can now be expected to seek quick resolution of bad-loan accounts.