After SBI, BoI looks to put bad loans worth Rs 15k cr on the block

economictimes.indiatimes.com:

Bank of India has circulated a list of bad loans with a total outstanding of Rs 15,000 crore to be considered for sale during the current financial year to asset reconstruction companies and other entities. The lender looks to enhance profitability from its legacy non-performing asset (NPA) accounts. The debt on sale has increased multifold compared with the previous year when the lender had showcased Rs 3,000 crore, a bank source said.

This follows State Bank of India's list of Rs 96,000 crore bad loans across 331 accounts circulated to gauge investor interest, as reported by ET. A Bank of India spokesperson could not immediately respond to a request for comment. The bank has identified 56 accounts to be put up for sale, which includes the debt of companies like Videocon Oil Ventures Limited, Videocon Limited, Visa Power, and Coastal Energen, Gitanjali Gems.

By selling these NPA accounts to asset reconstruction companies and other entities, Bank of India is looking to reduce its non-performing assets. As per the guidelines issued by the Reserve Bank of India (RBI), banks are required to create a list of non-performing assets at the beginning of each year, which they intend to sell. However, banks have the flexibility to modify the list by adding or removing accounts as per their discretion as the year progresses, an industry source said.

The list often includes accounts that are currently undergoing resolution processes in court or have been partly sold to asset reconstruction companies. This doesn't necessarily mean that these loans will be sold only to ARCs or sold at all, solely because they are listed. While some accounts may eventually be sold to ARCs, others may be resolved through alternative methods like