Last week, the bank circulated a preliminary list of 344 non-performing accounts with asset reconstruction companies (ARCs), the people said. There is a total outstanding debt of ₹ 24,278 crore on these accounts.
This is a preliminary list to gauge interest from buyers. The Chennai-based bank has requested an expression of interest from ARC with an indicative offer price, said one of the persons mentioned above. People said the bank aims to clean up its books to attract investors.
Aban Holdings has outstanding debt of ₹1,271 crore, which is the largest account on the list. Essar’s two companies are Essar Oil and Gas Exploration with ₹77.8 crore dues and Essar Power Gujarat with ₹148 crore. Other large accounts include Rotomac Global with ₹750 crore loan, Frost International with ₹839 crore, Era Infrastructure (₹567 crore) and Vadraj Cement (₹521 crore).
IOB did not respond to ET’s query.
The three companies in the Lanco Group are Lanco Amarkantak (₹876 crore), Lanco Infratech (₹509 crore) and Lanco Babandh (₹320 crore). The accounts of GVK Group are GVK Deoli Kota Expressway and GVK Coal Developers, with debts of ₹157 crore and ₹218 crore respectively.
A senior bank official, who spoke on condition of anonymity, said almost all the big loans on the list were sanctioned before 2015, “due to negligent lending to companies without adequate credit appraisal”.
The Reserve Bank of India had ordered prompt corrective action (PCA) on the bank in October 2015, barring the lender from giving additional corporate loans. For FY16, the bank’s gross NPAs stood at 17.4 per cent, and after provisions, the NPAs stood at 12%.
In September, after nearly six years, the bank pulled out of the PCA. It reported gross NPAs of 9.8%; After provisions, the net NPAs for FY 2012 stood at 2.6%.