Financial Daily from THE HINDU group of publications
Tuesday, Jun 07, 2005
Financial Daily from THE HINDU group of publications Tuesday, Jun 07, 2005 |
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Money & Banking
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Foreign Banks Foreign banks eye stressed assets here Sudhanshu Ranade
Chennai , June 6 ACCORDING to the March 2005 newsletter of SKP Crossborder Consultants, foreign commercial banks such as Deutsche Bank, Bank of America and Barclays Bank are examining the possibility of investing in stressed assets in India. These banks are reported to be interested in acquiring individual bulk exposures rather than a portfolio of bad loans. Quoting experts, the newsletter `eye to I(ndia)' says that India is fortunate because globally there is an oversupply of investible funds and an undersupply of bad loans of potential commercial value. After having dealt with their own non-performing assets (NPAs) in East Asia, these banks are now looking at investing in bad loans elsewhere as a business proposition. Foreign banks are also keen on setting up asset reconstruction companies (ARCs) in India, which is seen as having a $25-30 billion market of bad loans. Vulture funds and buyout funds are also waiting in the wings in the hope that the regulatory framework will allow them to participate soon, the newsletter says. Currently, there is no bar on foreign banks investing in bad loans.
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