The Hindu Business Line : NPA sale: PNB, Arcil in talks

Punjab National Bank (PNB) is in talks with Asset Reconstruction Company of India Ltd (Arcil) to shed some of its non-performing assets (NPAs) through this route. The bank is looking to pare its NPAs to one per cent of advances by end March 2008 from the level of 1.33 per cent as on end-December 2007."We are in talks with Arcil to sell some of the NPAs. The only issue with selling NPAs to asset reconstruction companies is that they want to buy them at big discount. Price offered by them is often low. Most of our NPAs are accounts with exposure of less than Rs 10 lakh," Mr J.M.Garg, Executive Director of PNB, told Business Line.

By end-March 2008, PNB wants to bring down the gross NPA as percentage of advances to three per cent against 4.11 per cent at end-December 2007. Advances of the bank at end-December 2007 stood at Rs 1,01,534 crore, representing a 15.8 per cent year-onyear growth. Gross NPA of the bank as on end-December 2007 stood at Rs 4,251 crore, which is lower than the level of Rs 4,717 crore as at end-September 2007. Net NPA as on end-December 2007 stood at Rs 1,339 crore. This represents a decrease of Rs 527 crore from net NPA level of Rs 1,866 crore as on end-September 2007. - K.R. Srivats

More Stories on : Public Sector Banks | Non-Performing Assets | Securitisation

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