Bank of India has identified seven-eight accounts, with an exposure aggregating ₹2,000-3,000 crore, to be shifted to the proposed asset management company (AMC), which has been envisaged for resolution by the Sunil Mehta panel under Project Sashakt.

The high-level committee on restructuring stressed assets and creating more value for public sector banks, which was headed by Sunil Mehta, Non-Executive Chairman, Punjab National Bank, recommended that for loans above ₹500 crore, an independent AMC should be set up.

“We have already discussed some of the accounts under the Project…We will be doing it (shifting accounts) before August-end. Already, the preparation is on...But again, it depends on (the provision level, the asset quality and valuations) negotiation and discussion.

“We will find out the right price for those assets and accordingly take a call, which will be taken by all the banks jointly. So, the first round (of) discussion is already over. We are expecting (the) second round in the first week of August,” said Dinabandhu Mohapatra, MD and CEO, Bank of India.

As per the Mehta Committee’s suggestion, an alternative investment fund (AIF) would raise funds from institutional investors. Banks would be given the option to invest in this fund if they wish to. AIFs can also bid for assets in the National Company Law Tribunal (NCLT).

The lead bank can discover the price through the open auction route. Security receipts have to be redeemed within 60 days.

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