The National Asset Reconstruction Company Ltd. (NARCL), set up to take over large bad loans of more than ₹500 crore from banks, will pick up the first set of such non-performing assets (NPAs) in July, the Finance Ministry said on Monday.
The NARCL, which will acquire the bad loans from banks, and the India Debt Resolution Company Ltd. - which will then manage these assets and seek to enhance their value - have secured necessary approvals and permissions. The boards of both entities, including the managing directors, are now in place, the Ministry said.
“With the account-wise due diligence nearing completion, the first set of accounts is expected to be transferred during July 2022,” it said in a statement after a review by Finance Minister Nirmala Sitharaman. “The remaining accounts are proposed to be taken over within the third quarter of the current financial year,” it added
The NARCL, whose formation was announced in the Union Budget for 2021-22, is intended to resolve stressed loans amounting to about ₹2 lakh crore, of which fully provisioned assets of about ₹90,000 crore are expected to be transferred to it from lenders in the first phase.