SBI to conduct biggest auction of seized properties

Mumbai, March 13:

In what has become the season for state-run auctions, the State Bank of India will on Saturday conduct one of its biggest auctions of seized properties worth Rs.1,200 crore across 26 Indian cities towards redeeming its bad debts.

More than 350 properties which include warehouses, offices, residential complexes and shops would be offered to potential buyers through e-auction.

The seized properties of loan defaulters are spread over Delhi, Mumbai, Kolkata, Chennai, Secunderabad, Pune, Bangalore, Ahmedabad, Lucknow, Aurangabad, Bhuwaneshwar, Indore, Cochin, Nagpur, Patna, Cuttack, Hyderabad, Vadodara, Varanasi, Siliguri, Raipur, Allahabad, Burdwan, Kanpur, Varanasi and Ludhiana.

The three platforms conducting the e-auction are Magicbricks.com, e-Procurement Technologies Ltd. and C1 India Ltd.

“We go for auctions on a regular basis but this would be the first time that we are doing such a large auction on a national level,” said Parveen Kumar Malhotra, deputy managing director and group executive, stressed asset management group of the SBI.

He said the properties would be available at a discount of 10 percent on the prevailing market rates.

SBI currently has Rs.60,000 crore ($10 billion) worth of bad debts, which figure is growing.

At a meeting here on Wednesday called by Finance Minister Arun Jaitley to review the performance of public sector banks, senior officials discussed ways of dealing with the problem of rising non-performing assets (NPAs) or distressed loans.

The NPAs of public sector banks rose to 5.33 percent of total advances in September 2014, from 4.72 percent in March 2014. Stalled projects have been adding to banks’ NPAs.

As per the ministry’s latest Economic Survey, stalled projects as on December-end amounted to Rs.880,000 crore-worth.

In this connection, the finance ministry said of Wednesday’s meeting that “it was expected that some actions on the part of the banks, identified at Gyan Sangam (Bankers’ Retreat, in Pune) in January 2015, relating to risk management and asset quality, would be taken by them (banks)”. IANS