Kolkata: State-run lender Allahabad Bank is looking at a recovery of around Rs 5,500 crore in the current fiscal, an official said on Wednesday.
The bank has submitted a roadmap to the Centre and if everything goes "well and smooth" as per its projections, it was likely to come out of prompt corrective action (PCA), imposed by the Reserve Bank of India (RBI), by March 2020, the official said.
"We are expecting Rs 3,000 crore recovery through resolution in NCLT (National Company Law Tribunal) in the entire financial year, another Rs 2,000 crore through normal recovery process and Rs 400-500 crore through asset sales," Allahabad Bank Executive Director N.K. Sahoo said.
"We have recently recovered around Rs 1,300 crore from the resolution of Bhusan Steel and Electrosteel Steels," he added.
The bank has an outstanding exposure of Rs 4,000 crore in several accounts referred to NCLT including Uttam Galva, Alok Industries, Essar Steel, he said, adding that it was hopeful of recovering from these accounts in the current fiscal.
The bank may have to take a hair-cut upto 50-60 per cent in these accounts, he added.
"We have created a NCLT cell to effectively monitor the NCLT accounts. We have almost 94 (stressed) accounts referred by us as well as by other lenders amounting around Rs 12,000 crore.
"Almost 45 per cent of our gross NPA is in the NCLT," Sahoo told shareholders here at the 16th Annual General Meeting of the Allahabad Bank.
Capital requirement for the lender during the current fiscal would be close to Rs 9,000 crore, Sahoo said on the sidelines of the meeting.
"The bank would require close to Rs 9,000 crore worth capital this fiscal," he said.
Of the total capital requirement, the bank requested the government to pump in Rs 7,000 crore and was looking to raise close to Rs 1,900 crore through different modes this fiscal.
This apart, it is hopeful of raising close to Rs 500 crore from sale of non-core assets.
"A roadmap has been submitted to the (Finance) Ministry. If everything goes well as per the bank's projection, we are expecting to come out of PCA by March 2020," he said.
At the end of the 2017-18, gross NPA (non performing assets) of the bank stood at Rs 26,562.76 crore as compared to Rs 20,687.83 crore in FY 17 (2016-17) and Net NPA remained at Rs 12,229.13 crore as on March 31, 2018 as against Rs 13,433.51 crore in FY 17.
Owing to high non-performing assets (NPA) and negative return on assets (RoA) for two consecutive years, the bank was brought under prompt corrective action framework by the RBI on January 2, Sahoo told shareholders.
In fact, subsequently, the RBI had imposed additional restrictions on Allahabad Bank under prompt corrective action (PCA) framework.
It was asked to restrict expansion of risk-weighted assets (RWA), reduce exposure to high-risk loans and restrict accessing or renewing wholesale deposits.
The bank had posted a net loss of Rs 3,509.63 crore in the March quarter of 2017-18.