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DBS Bank India to auction off ₹437 crore NPLs, anticipates 7% recovery

DBS Bank India to auction off ₹437 crore NPLs, anticipates 7% recovery
© Reuters.

DBS Bank India is set to auction off non-performing loans (NPLs) worth ₹437 crore in an effort to recover 7% of the total value. The bank has set an anchor bid reserve price at ₹30 crore. The auction includes 69 accounts, with 11 identified as fraud exposures.

Omkara Asset Reconstruction Company (ARC) has shown interest by proposing a cash offer for the base deal. Following this, DBS India has invited counter bids, stipulating that these should be at least 5% higher than the base deal. A Swiss challenge, a bidding process where other bidders can offer more than the initial bid and the initial bidder gets a chance to match or exceed it, is scheduled for November 7. In this case, Omkara ARC will have the opportunity to match the highest bid.

This move comes as part of DBS Bank India’s ongoing efforts to improve asset quality. For the fiscal year 2023, the bank has reported significant improvements in its asset quality metrics. Both net and gross Non-Performing Asset (NPA) ratios have decreased, standing at 1.17% and 5.61% respectively. These improvements have contributed to a net profit of ₹228 crore for the bank.

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