UBI looking to sell bad loans to spruce loan book
18 March 2010
State-owned lender United Bank of India (UBI) is in talks with a a number of asset reconstruction companies (ARCs) to sell a part of its bad loans in a bid to clean up its loan book, according to a top bank official.
According to T M Bhasin, executive director, UBI, the Kolkata-based bank has plans to sell of Rs100-crore of its bad loans by end March and has already sold Rs200-crore worth bad assets so far in this fiscal.
"We have received bids from ARCs to sell our bad assets. We are presently evaluating these bids and expect to sell Rs100 crore worth bad loans by the end of this month," Bhasin told reporters in Mumbai at the bank's listing ceremony.
The decision comes as part of restructuring its advance portfolio which will also reduce the non performing assets burden, Bhasin said. He, however did not say which segments had contributed most to the bad loans burden.
UBI's gross NPA level at present stands at 2.4 per cent with its net NPA's standing at 1.21 per cent. This is slightly on the higher side as against that of most of its peers.
With a loan book that currently stands at Rs43,000 crore, the bank has a total deposit-base of around Rs67,000 crore.