The Hindu Business Line : IDBI finalises roadmap for stressed assets fund closure

IDBI has finalised the roadmap for closing the Stressed Asset Stablisation Fund (SASF), to which stressed assets amounting to Rs 9,000 crore were initially transferred.

A review meeting held two days ago has outlined a five-year timeframe for diluting SASF. The closure will put an end to what started as a special purpose vehicle set up by the Government (in the form of an asset management trust), aimed at lightening IDBI's burden of NPAs.

The fund, said Mr V.P. Shetty, Chairman, had met part of its objectives. This is reflected in its accomplishments: one, it has resolved 227 of the 650-plus cases; and, two, the cash recovery stands at Rs 600 crore, counting from the date of inception.

"We will be able to close SASF in five years or so. There will be some cases of sale of assets, while some accounts may be even taken back in our books," Mr Shetty said.

SASF, incidentally, was accorded the status of an FI; this was done with a view to allow it access the DRTs (Debt Recovery Tribunals). Targets for the fund, set earlier, are largely being met, it is pointed out.

Eyeing insurance: IDBI, meanwhile, is looking at the possibility of entering into insurance (which will be an altogether new activity) and re-entering the mutual funds space. It is not clear whether IDBI Capital, its 100 per cent subsidiary, will be utilised for promoting these businesses. Nor is it clear whether a partner will be roped in.

However, Mr Shetty broadly indicated that IDBI would not be interested in holding a stake below 26 per cent in any venture whatsoever. IDBI Capital, incidentally, has lately stepped into stock broking as part of a plan to widen its product offerings. IDBI, which has an asset size of Rs 82,000 crores, aims to increase it to about Rs 90,000 crore.

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