The Hindu : Business : Pact for recovery of non-performing assets

Online edition of India's National Newspaper
Wednesday, Aug 11, 2004

Business

Business

Pact for recovery of non-performing assets

By P. Vikram Reddy

HYDERABAD, AUG. 10. The Andhra Pradesh Industrial and Technical Consultancy Organisation (APITCO) is signing an agreement with Asset Reconstruction Company (India) Ltd. (ARCIL) in Mumbai on Wednesday to become an agent for ARCIL and be entrusted with the task of recovery and liquidation of some non-performing assets (NPAs).

Set up under the Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest (SARFASI) Act, ARCIL's task is to acquire NPAs from the banking system for recovery. In this process, a portfolio of NPAs is entrusted to each of its agents.

APITCO is expected to be given an NPA portfolio of Rs. 100-125 crores of a Hyderabad based bank, given the strengths of APITCO — which has its base in Hyderabad and has been catering to SMEs in Andhra Pradesh for 28 years, by advising entrepreneurs, policy makers, financial institutions and state government on issues relating to SMEs. Sources in APITCO said the portfolio comprises mostly NPAs of Rs. 1-10 crores pertaining to SMEs.

The organisation expects a revenue of about 5 per cent on the realised value of asset portfolio, and has committed to putting in place a special team comprising a legal expert, two former bank officials, and a company law expert, besides pooling in some of its senior and junior consultants.

Printer friendly page
Send this article to Friends by E-Mail

Business