IDBI plans to drastically cut down NPAs
By Our Banking Bureau | 03 Jun 2002
Mumbai:
Industrial
Development Bank of India (IDBI) is planning to bring
down non-performing assets (NPAs) to below 5 per cent
of its total loan portfolio by the end of the fiscal year
2002-03. It currently stands at 11.69 per cent.
Asset
recovery and rejuvenation have taken precedence over sanctions
and disbursements, with the premier term-lender giving
recovery targets rather than advance targets to its branches.
IDBI officials say branches are expected to show a 100-per
cent recovery rate for standard assets.
For
substandard assets the target is 25 per cent, and doubtful
assets may be recovered to the extent of at least 10 per
cent. The extra-cover provided to NPAs was possible because
the government rolled over about Rs 2,150 crore of its
soft loans to IDBI for another 20 years.
Since the bonds qualify for tier-I capital, the capital adequacy ratio of the institution has improved to 17.86 per cent. The gross NPAs stood at Rs 11,768 crore as on 31 March 2002.
Of IDBIs total assets of Rs 66,625 crore, 88.31 per cent was standard assets, 4.52 per cent substandard and 7.17 per cent doubtful assets. Restructured assets in standard assets amounted to about Rs 4,000 crore.
