BoI to get Rs 1993 crore from Tata Steel-Bhushan Steel deal
Kolkata: The state-owned Bank of India (BoI) would be able to realise around Rs 1993 crore from the first successful NCLT resolution concerning Tata Steel and Bhushan Steel, an official said. The amount would not include hair-cuts, BoI managing director and chief executive officer D Mohapatra said.
The realisation of the amount would lead to NPA reduction and increase profitability of the bank, he said.
"The first successful NCLT resolution involving Tata Steel and Bhushan Steel will help in realise Rs 1993 crore. If there are haircuts, the amount will be written back from provisioning," Mohapatra told at news conference here on Saturday.
In the first list of 12 accounts sent to NCLT for resolution under Insolvency and Bankruptcy Code (IBC), BoI's exposure was Rs 8300 crore. In the second list of 27 accounts, the exposure was Rs 3000 crore, he said. "Once all the resolutions are successfully completed which is expected in FY 2019, the bank will see a rise in profitability", he added.
Under the Standby Letter of Credit (SLOC) scheme, the bank was able to recover Rs 9000 crore and some Rs 500 crore remains, he said.
Mohapatra said that Punjab National Bank (PNB) had returned Rs 2500 crore to BoI which it had honoured in the Nirav Modi scam.
The bank was also in the process of rationalising the number of ATMs based on cost-benefit analysis, he said.
Retail, agri and MSME advances constituted more than 50 per cent of the total lending of the bank, Mohapatra said.
Meanwhile, steel tycoon Sajjan Jindal on Saturday congratulated Tata Group Chairman Emeritus Rata Tata and Senior officials on the successful acquisition of bankrupt Bhushan Steel.
He also exuded confidence that the Tata Group will "nurture" the good quality asset.
Tata Steel Ltd has won the bid to acquire debt-laden Bhushan Steel Ltd (BSL) in an insolvency auction. The bankrupt firm was among the 12 stressed assets the RBI had referred to NCLT proceedings last year. "Congratulations to #TVNarendran #NChandra @RNTata2000 and @TataCompanies for the successful acquisition of #BhushanSteel. It's always gratifying when a good quality asset goes into the hands of an institution which will nurture it and build it further," Jindal said in a tweet.
On Friday, Tata Steel said it has successfully completed the acquisition of controlling stake of 72.65 per cent in Bhushan Steel Ltd (BSL) through its wholly-owner subsidiary Bamnipal Steel Ltd (BNPL).
"BNPL has successfully completed the acquisition of controlling stake of 72.65 per cent in BSL in accordance with the approved resolution plan under the Corporate Insolvency Resolution Process (CIRP) of the Insolvency and Bankruptcy Code 2016 (IBC) which has been managed by Vijaykumar V lyer, Partner, Deloitte Touche Tohmatsu India LLP, in his capacity as the resolution professional," Tata Steel said in a statement.
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