LIC to go all out to recover 'sub-standard' Unitech loan

The Life Insurance Corporation (LIC) on Tuesday said real estate developer Unitech's Rs200-crore loan account continues to remain sub-standard, and it will pursue all options to recover the money.

A top company official told news agency PTI that all processes, as prescribed by the Reserve Bank of India (RBI) and the government to deal with wilful defaulters, will be initiated if Unitech fails to repay the dues on time.

"Unitech's account as of today remains sub-standard. Unless they repay the amount, due processes will be followed," the official said when asked about the media reports which said the insurance behemoth has taken a "notional possession" of a slice of Unitech's 350-acre land parcel in Noida.

There were also reports that LIC had declared Unitech a "wilful defaulter".

Unitech had taken a Rs200-crore loan from LIC in 2007 for a project in Noida. Last December, the nations' largest financial institution had issued a notice to Unitech after it defaulted on one of the installments.

When contacted, a Unitech company official claimed the loan has been served regularly and all the dues will be cleared in the next few days.

Meanwhile, sources told PTI that Unitech has sold almost 10 acres in Bangalore and Mysore for Rs. 100-130 crore as part of its strategy to repay the debt.

At present, the company has debt of about Rs6,200 crore in its books, including the Rs200 crore to LIC.

(Also see:  Unitech sells 10 acres in Bangalore, Mysore to repay debt)