ICICI Bank to sell Rs 1000 crore NPAs from Tulip Telecom, Falcon Tyres

The largest private sector lender ICICI Bank has put two stressed assets with an exposure of Rs 1,000 crore on the block to be sold to asset reconstruction companies, market sources said today.

The two accounts include Tulip Telecom (Rs 700 crore) and Falcon Tyres (Rs 300 crore). Both have been declared as non-performing assets for sometime now, the bank said.

All the major asset reconstruction companies (ARCs) in the system have been approached for the asset sale, as per sources.

The bank had reported an increase in its gross non-performing assets ratio at 3.78% in March 2015, and had said a bulk of NPAs are coming from assets restructured earlier.

The bank scrip closed 3.09% down at Rs 291.20 a piece on the BSE.

It can be noted that since last fiscal, ARCs have non been keen to pick dud loans from banks after the Reserve Bank asked them to pay three times more upfront amount from 5-15% of the asset value. Following this, there was a massive drop on fresh asset sales to pick up by ARCs.

Last week, the new head of the country's oldest ARC Arcil had said he would be focusing on retail, SME assets and not banking assets, and would also seek better pricing.

"Banks typically come up with auctions with a mixed bag of assets in it, and ask and expect ARCs to buy those. We would prefer to have abilities to buy assets, either on industry preferences or on the basis of size or a little niche," Arcil's newly-appointed chief executive and managing director Vinayak Bahuguna had said here last week.

"We see a lot of opportunities in retail assets.

Experience has shown that there is a higher rate of churn in these portfolios so capital can be churned faster. Therefore, it suits us to look at this particular asset base and try to grow that book, he said. Arcil would be very selective towards buying large corporate assets," he added.