Indian Overseas Bank to sell 46 NPA accounts worth ₹11,500 crore

Public sector Indian Overseas Bank (IOB) on Thursday (January 9) said it has invited expressions of interest (EOIs) from asset reconstruction companies (ARCs) for the sale of 46 non-performing asset (NPA) accounts, collectively valued at ₹11,500 crore.

This move is part of IOB's ongoing strategy to reduce NPAs and improve its asset quality. The bank has made significant progress in this regard, reducing its gross NPA ratio from 11.69% in March 2021 to 2.72% as of September 2024. Additionally, net NPAs have decreased from 3.58% in March 2021 to just 0.47% in Q2 FY 2024-25.

The sale of these 46 NPA accounts will be conducted through an e-auction, using the open auction method on a portfolio basis. The accounts include those financed under consortium arrangements, with some admitted under the Company Law Tribunal (NCLT).

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Prospective buyers will have the option to bid for the entire portfolio, individual accounts, or groups of accounts, further streamlining the disposal process.

Eligible ARCs and other transferees may submit their EOIs by January 18, 2025, to participate in the e-auction scheduled for January 30, 2025. Details regarding the accounts and terms of sale are available in the sale notification on the bank's website.

Ajay Kumar Srivastava, MD and CEO of Indian Overseas Bank, said, "The bank’s unwavering focus is on value maximisation through robust recovery measures, including SARFAESI actions, compromise settlements, and sales to ARCs."

He added that the sale of the MSME and educational loan portfolios to ARCs is also under active consideration, aligning with the bank’s strategy to enhance recovery outcomes and asset quality.

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Shares of Indian Overseas Bank ended at ₹50.09, down by ₹0.69, or 1.36%, on the BSE.