IOB announces sale of 46 NPA accounts worth Rs 11,500 crore

CHENNAI: In its second round of large non-performing asset (NPA) loan sale, Indian Overseas Bank (IOB) on Thursday announced the sale of 46 NPA accounts worth Rs 11,500 crore. It comes nine months after the public sector bank put 91 NPA loans with a cumulative value of Rs 13,471 crore on sale in March last year.

The bank has invited expressions of interest (EOI) from asset reconstruction companies (ARCs) for the fresh sale of NPAs, which is a mix of new and NPA accounts that has been carried forward from the previous sale. They include Videocon, LANCO, IL&FS Financial Services, Jet Airways, the now defunct Reliance Communication, Samsung C and T Corporation, the EOI published by IOB said.

Reserve price on 100% cash basis of Rs 2,290 crore has been fixed. However, the sale price will be proportionately revised to the extent of any part or full recovery. The sale will be conducted through and e-auction, wherein prospective buyers can bid on a portfolio basis, individual accounts, or groups of accounts.

IOB MD & CEO Ajay Kumar Srivastava said the bank is focusing on value maximization through robust recovery measures, including SARFAESI actions, compromise settlements and sales to ARCs.

"The sale of MSME and educational loan portfolios to ARCs is also under active consideration, aligning with our strategy to enhance recovery outcomes and asset quality," he said in a statement.
When contacted, Srivastava said 25 NPA accounts had been resolved from the 91 NPA loans over the past nine months. "We have realised Rs 2,800 crore through our first round of NPA. At least 50% of account sales with a value 30-35% are expected from the fresh sale," he told TOI.

The PSB's gross NPA ratio has reduced from 11.69% as of March 31, 2021 to 2.72% during the quarter ended September 30, 2024. Also, the net NPA ratio declined from 3.58% in March 2021 to 0.47% during the July-Sep quarter of 2024-25.


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