31 banks, FIs clean up accounts by selling NPAs

New Delhi, Apr 6 (UNI) A large number of banks and Financial Institutions (FIs) have cleaned up their balance-sheets by selling their Non-Perfoming Assets (NPAs) worth Rs 21,144 crore to an asset reconstruction entity in the last two-and-a-half years.

The Asset Reconstruction Company India Ltd (Arcil) acquired NPAs from 31 banks and FIs involving 562 borrowers' since August, 2003.

Further, 173 cases comprising 52 per cent of the outstanding dues acquired have been resolved, of which 64 cases, having dues of Rs 2,010 crore have been fully exited, an Arcil release said here today.

For the financial year 2005-06, the company acquired NPAs from 22 banks and resolved 115 cases. The total dues acquired for the period were Rs 8,856 crore.

A total of Rs 870 crore has been recovered and distributed to investors after netting expenses.

Asset Reconstruction Companies (ARCs) are established to acquire NPAs from the FIs and banks, and focus on the management of these assets and maximisation of recovery.

Arcil, which adopts a bank-based model of ARC, is sponsored by the State Bank of India, ICICI Bank Ltd, IDBI Ltd and Punjab National Bank.

UNI RA/PC BD1748