Financial Daily from THE HINDU group of publications
Thursday, Apr 28, 2005
Financial Daily from THE HINDU group of publications Thursday, Apr 28, 2005 |
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Money & Banking
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Non-Performing Assets Central Bank plans ARC with 3 other banks Our Bureau
Mr Dalbir Singh
Mumbai , April 27 CENTRAL Bank of India is planning to set up an asset reconstruction company jointly with Standard Chartered Bank, Oriental Bank of Commerce and Dena Bank, with each bank having a stake of around 20 per cent. The banks have approached the Reserve Bank of India and the Government for approval, said officials of Central Bank. Dr Dalbir Singh, Chairman and Managing Director of Central Bank, said the bank is likely to have 25 per cent stake in the ARC. "It is a big market for us. Around Rs 2,00,000 crore is locked in non-performing assets. So, it will be a profitable venture for us," he added. The project was scheduled for February 2005, but clearance from the Government and the RBI was taking time, said a senior official of Central Bank. It has been registered as Special Asset Recovery Private Ltd, he added. Dr Singh was speaking at the inauguration of the ATM in the premises of Tata Institute of Fundamental Research. Central Bank has established its own Electronic Financial Transactions Switch at Navi Mumbai, which is capable of supporting 1,000 ATM installations. In the first phase, the bank will be commissioning a network of 400 ATMs. About the bank's performance for the financial year 2003-04, Dr Singh said the bank is likely to post gross profit of Rs 90,000 crore. "We have better operating profit than last year. Our deposit growth has also been good," he said. About the recovery, he said the bank has recovered Rs 600 crore, of which cash recovery comprises around Rs 450 crore and the remaining is through upgradation. The gross NPA level is likely to be around 8 per cent, with a reduction of Rs 400 crore in NPAs, he added. An official from the bank said that the bank's net NPA is likely to be 3 per cent, down from 5 per cent last year.
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