Utkarsh SFB to sell NPA and written-off loans worth about Rs 727 crore to ARC
UTKARSHBNK · price
▲ positive · ▼ negative · ● neutral filings · teal = economic event · numbered = multiple that day (click to pick). Times IST.
Utkarsh Small Finance Bank will sell stressed assets to an Asset Reconstruction Company in three pools. Pool 1 has 1.67 lakh unsecured microfinance loan accounts with Rs 507.42 crore principal outstanding, reserve price Rs 75.35 crore. Pool 2 has 47,168 unsecured microfinance accounts at Rs 143.12 crore principal, reserve price Rs 20.04 crore. Pool 3 has 288 secured commercial vehicle and construction equipment loans at Rs 76.29 crore principal, reserve price Rs 49.59 crore. Total principal outstanding is about Rs 726.83 crore against total reserve price of about Rs 144.98 crore, indicating steep haircuts especially on microfinance pools.
Signals ongoing asset quality stress in microfinance book; large haircuts may impact near term earnings but frees up capital and cleans balance sheet.