Bank Of India To Get Rs 1,993 Crore From Tata Steel-Bhushan Steel Deal

State-owned Bank of India would be able to realise around Rs 1993 crore from the first successful resolution by the National Company Law Tribunal concerning Tata Steel and Bhushan Steel, an official said.

The amount would not include haircuts, BoI Managing Director and Chief Executive Officer D Mohapatra said. The realisation of the amount would lead to non-performing asset reduction and increase profitability of the bank, he said.

“The first successful NCLT resolution involving Tata Steel and Bhushan Steel will help in realise Rs 1,993 crore. If there are haircuts, the amount will be written back from provisioning,” Mohapatra told reporters.

In the first list of 12 accounts sent to NCLT for resolution under Insolvency and Bankruptcy Code, BoI’s exposure was Rs 8,300 crore. In the second list of 27 accounts, the exposure was Rs 3,000 crore, he said.

“Once all the resolutions are successfully completed who is expected in FY 2019, the bank will see a rise in profitability,” he added.

Under the Standby Letter of Credit scheme, the bank was able to recover Rs 9,000 crore and some Rs 500 crore remains, he said. Mohapatra said that Punjab National Bank had returned Rs 2,500 crore to BoI which it had honoured in the Nirav Modi scam.

The bank was also in the process of rationalising the number of ATMs based on cost-benefit analysis, he said.

Retail, agri and micro, small and medium enterprises, and advances constituted more than 50 percent of the total lending of the bank, Mohapatra said.