MUMBAI – Bandhan Bank has sold its affordable home loan portfolio to Asset Reconstruction Company (India) Ltd (Arcil) for ₹280 crore. The portfolio, valued at ₹775 crore, was sold through a Swiss challenge auction process. The transaction, which took place on Wednesday, indicates a recovery rate of approximately 36%.
The sale of this portfolio is indicative of the financial difficulties faced by low-income homeowners. Details of the transaction, including comments from Arcil and Bandhan Bank, have not been made public. The sale of these assets is part of the bank’s broader strategy to manage its balance sheet in the current economic climate affecting the housing sector.
Bandhan Bank’s decision to divest part of its loan portfolio comes as Indian financial institutions face the consequences of the pandemic and its impact on borrowers’ ability to repay their loans. The affordable housing sector has been particularly vulnerable, with many landlords in this segment facing liquidity challenges.
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2023-12-28 19:49:29
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