NARCL will make a mandatory offer for the first step of the account within two weeks: SBI MD
The National Asset Reconstruction Company (NARCL), commonly known as the worst bank in India, will make a mandatory offer for the first phase of the account in the next few weeks, a senior State Bank of India (SBI) senior executive said on Friday.
Swaminathan J, Managing Director of Risk, Compliance and Stressed Asset Resolution, SBI, said that the process of identifying accounts and due diligence is almost complete. “They are in the final stages of preparing approvals for making compulsory offers to banks,” he said We hope it will be a few weeks away, “he said.
Banks want to transfer Rs 2 trillion worth of stressed assets in the first phase Once Bad Bank makes a mandatory offer, the next step would be to convene a joint lender meeting for the major lenders and then run a Swiss Challenge auction with the anchor bids of NRCL’s offers. Other ARCs will have the opportunity to offer all cash because bad bank security receipts (SRs) are backed by the central government. If other bidders participate, NARCL will be given more time to consider whether they want to match the offers.
The plan to transfer assets has been hampered by delays due to regulatory concerns about the dual structure and managerial appointments of bad banks. NARCL has already missed its March 31, 2022 deadline to acquire 15 assets worth Rs 50,000 crore. All vacancies in NARCL will now be filled and RBI approval will be sought wherever required, the SBI said on Friday.
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