The 12 large non-performing assets (NPAs or bad loans) accounts directed by the RBI for resolution through insolvency process had total outstanding of Rs 3.45 lakh crore against their liquidation value of Rs 73,220.23 crore, while haircuts taken by creditors in case of the resolved accounts so far have been as high as 90 percent, according to the insolvency regulator IBBI data.
This shows the huge gap between the value of the assets and the outstanding the firms had accumulated.
The resolution of 12 large accounts were initiated by banks as directed by the Reserve Bank of India (RBI). Together they had an outstanding claim of Rs 3.45 lakh crore as against their liquidation value of Rs 73,220.23 crore. Of these, resolution plans in respect of six corporate debtors have been approved.
The insolvency regulator data also showed that out of these six, Bhushan Steel has the highest realisation claims so far, and Alok Industries has the lowest at 11 percent.
Due to the failure to implement the approved resolution plan in Amtek Auto Ltd, the process has restarted. Other accounts are at different stages of the process, the data showed.
The Insolvency and Bankruptcy Board of India (IBBI) data states out of those six resolved cases, the outstanding dues admitted in the case of Electrosteel stood at Rs 13,175 crore and the amount realised was a mere Rs 5,320 crore, or 40.38 percent realisation of the claims.
In the case of Bhushan Steel, the amount admitted was Rs 56,022 crore and that realised was Rs 35,571 crore, or 63.50 percent realisation. In the case of Monnet Ispat and Energy, the admitted amount was Rs 11,015 crore, while Rs 2,892 crore or 26.26 percent of admitted dues was realised.
In the Essar Steel case, the due admitted was Rs 49,473 crore and the apportionment between financial creditors and operational creditors is under consideration at the National Company Law Appellate Tribunal (NCLAT) since the case has been resolved.
The National Company Law Tribunal (NCLT) has cleared ArcelorMittal's Rs 42,000 crore resolution plan for the insolvent Essar Steel but the case is now in NCLAT after one of the operational creditors, Standard Chartered, filed an appeal against the due amount allotted to it by the financial creditors.
In the case of Alok Industries, the admitted amount was Rs 29,523 crore and Rs 5,052 crore was realised, which is a 17.11 percent realisation. In the case Jyoti Structure, the due was Rs 7,365 crore and Rs 3,684 crore was realised, which represents a 50 percent realisation.
The RBI's February 12, 2018, circular under which these assets were resolved has been declared ultra vires by the Supreme Court earlier this month and banks are now the decision makers on the resolution of their stressed assets.
First Published: IST