Latest news with #ARCs
Time of India
25-05-2025
- Business
- Time of India
ARCs seek bigger role in RBI's new securitisation framework
Live Events (You can now subscribe to our (You can now subscribe to our Economic Times WhatsApp channel MUMBAI: Asset reconstruction companies (ARCs) have urged the Reserve Bank of India to recognise ARC-sponsored trusts as eligible special purpose entities (SPEs) under the securitisation structure. These trusts are already operationally geared to manage stressed asset pools, they RBI 's draft allows pooling and securitising stressed retail and corporate loans, barring categories like farm loans education loans , fraud, and wilful defaults. Investors must not be related to borrowers or disqualified under IBC have also requested permission to act as investors or co-investors in these securitised asset pools, alongside other eligible investor classes. They have proposed a minimum ARC investment threshold of 2.5% of the total notes issued, to ensure skin in the the operational front, ARCs have asked the RBI to clarify which entity will be responsible for fulfilling regulatory obligations such as updating credit bureau (CIBIL) records, completing KYC compliance, and issuing "no due" certificates to avoid regulatory currently have three primary options for resolving stressed assets: in-house settlement or restructuring, legal routes such as DRT or IBC, and sale to asset reconstruction companies (ARCs). The RBI's proposed framework introduces a fourth option, which is securitisation of stressed assets, offering a market-based alternative for quicker resolution."Given the prolonged delays and uncertainties in legal proceedings, banks may increasingly prefer this route for faster exit and immediate recovery, especially as delays under legal processes lead to higher provisioning burdens year after year," said Hari Hara Mishra CEO ARC Association. "Resolving smaller loan exposures from courts to market mechanisms like securitization could also help decongest the overburdened legal system."The total debt acquired by ARCs have cumulatively reached Rs 16.14 lakh crore in FY25, which is driven by the one-time transfer of Rs 4.23 lakh crore from the stressed asset stabilisation fund to a single ARC. Excluding this extraordinary item, the incremental acquisition stood at Rs 1.71 lakh crore, nearly flat compared to Rs 1.73 lakh crore recorded in FY24.
Time of India
23-05-2025
- Business
- Time of India
At Rs 16 lakh crore, ARCs acquire 60% more bad loans in FY25
MUMBAI: India's market for stressed loans saw a sharp rise in the acquisition of lenders' dues by bad loan companies in FY25, mainly due to a one-time transaction involving the Stressed Assets Stabilisation Fund (SASF). This govt-backed vehicle was set up in 2004 to house Rs 9,000 crore of bad loans from IDBI Bank. Asset reconstruction companies (ARCs) acquired dues worth Rs 16.1 lakh crore during the year, up over 60% from Rs 10.2 lakh crore in FY24. Of this, Rs 4.22 lakh crore came from the transfer of legacy assets held by SASF, which was wound up in 2024 after two decades of attempted recoveries. Though the notional value of the SASF assets was high, the actual recoverable amount eroded over time. ARCs issued security receipts (SRs)-instruments backed by expected recoveries-at a significantly lower value to reflect this loss. SRs are redeemed as ARCs recover money from borrowers and serve as a proxy for how effective they are in resolving bad loans. While the SASF deal inflated the total book size in terms of creditors' dues, fresh business remained muted. Issuance of new SRs stood at Rs 37,511 crore, nearly unchanged from Rs 37,864 crore a year earlier. However, redemptions rose to Rs 43,256 crore from Rs 37,364 crore, indicating improved recoveries, particularly from power and infrastructure assets. Of the Rs 46,621 crore recovered during the year, about two-thirds came through legal and restructuring channels such as the Insolvency and Bankruptcy Code (IBC), with the rest from asset sales and settlements. by Taboola by Taboola Sponsored Links Sponsored Links Promoted Links Promoted Links You May Like This Device Made My Power Bill Drop Overnight elecTrick - Save upto 80% on Power Bill Pre-Order Undo The slowdown in new deals reflects the improved health of the banking sector, with gross non-performing assets falling below 3%. This has reduced the supply of fresh bad loans to ARCs, keeping new acquisitions flat for the past three years. Stay informed with the latest business news, updates on bank holidays and public holidays . AI Masterclass for Students. Upskill Young Ones Today!– Join Now
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Business Standard
21-05-2025
- Business
- Business Standard
ARCs earning from SR redemption up 15.8% in FY25 on better recovery
The earnings of Asset Reconstruction Companies (ARCs) from redemption of securities receipts (SRs) grew by 15.8 per cent year-on-year (Y-o-Y) to ₹43,256 crore in the financial year 2024-25 (FY25). The redemption of SRs, broadly representing recovery, improved substantially as the economy picked up and amount locked up in stressed sectors like power, infrastructure got resolved, according to the Association of ARCs in India. ARCs had redeemed SRs worth ₹37,364 crore in FY24 and ₹27,356 crore in FY23. SRs are financial instruments issued to qualified buyers as consideration for purchasing distressed assets from banks or financial institutions. While the redemption of receipts increased in FY25, the SRs issued for bad loans acquired by ARCs declined during the period. They issued SRs amounting ₹37,511 crore in FY25, down from ₹37,864 crore in FY24 and ₹41,406 crore in FY23. With stable gross non-performing assets (NPAs) of the banking system below 3 per cent, fresh ARC business remained almost stagnant. The pace of issuance of security receipts issued for acquisition of NPAs remained muted. The redemption outpaced acquisition due to improved recovery and collections. For the next year too, the situation is likely to continue, said Hari Hara Mishra, CEO, Association of ARCs in India in a statement. Also, with the redemption of SRs being higher than fresh SRs issued, the outstanding SRs declined to ₹1.34 trillion in FY25 from ₹1.39 trillion in FY24. The asset sale & settlement contributed only 1/3rd of recovery, the remaining 2/3rd came through Insolvency and Bankruptcy Code (IBC), and in-house restructuring and other measures, the association said. The total dues acquired by ARCs cumulatively rose to ₹16.14 trillion, including those from Stressed Asset Stabilisation Fund amounting to ₹4.22 trillion transferred to an ARC during FY25, it added. The total dues acquired were ₹10.2 trillion at the end of FY24 and ₹8.48 trillion in FY23.
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Business Standard
13-05-2025
- Business
- Business Standard
Multiple ARCs express interest in stressed loans of Sahara Hospitality
Once the entities that have submitted EoIs complete their due diligence, binding bids for acquiring the exposure will be invited Subrata Panda Mumbai Listen to This Article Around 17 to 18 expressions of interest (EoIs) have been received for acquiring the ~728.58 crore stressed exposure of a consortium of banks led by Union Bank of India in Sahara Hospitality Ltd, according to people familiar with the matter. The due diligence period has been extended until May 20, after which binding bids will be invited for the acquisition. Multiple asset reconstruction companies (ARCs) including Asset Reconstruction Company (India) Ltd, Phoenix ARC, JM Financial ARC, Edelweiss ARC, among others have given EoIs for acquiring the stressed exposure of the consortium of banks. Other banks in the consortium include UCO
Express Tribune
25-03-2025
- Business
- Express Tribune
Land transaction service to be franchised
Public outcry in Canada as Google Maps removing the state owned building on Canada's digital maps. PHOTO: PEXELS The Punjab Land Records Authority (PLRA) Board has approved proposals for the introduction of a franchising model, restructuring of Arazi Record Centres (ARCs) and the procurement of a digital authentication service. In a meeting, the board deferred a proposal to acquire additional land for expanding the authority's head office in Lahore. PLRA Chairman Chaudhry Tariq Subhani, speaking to The Express Tribune on Tuesday, stated that the board's agenda focused on initiatives aligned with the authority's long-term strategy to enhance efficiency, security and accessibility in land-related services. He highlighted that one of the most significant approvals was for the CNIC-MSISDN Pairing Authentication Service (CMPA), a digital security mechanism that verifies citizens' mobile phone number against their computerised national identity card (CNIC). The system is expected to bolster security, prevent unauthorised access to sensitive land records and facilitate new service initiatives such as the franchising model. It was decided that the Pakistan MNP Database (PMD) Guarantee Limited will provide the service, ensuring that only verified users can access land records through their registered mobile numbers. Under the agreement, the first 10 million transactions will be processed at a fixed rate of Rs15 per transaction, with no price escalation for three years. Beyond this limit, transaction costs will increase gradually over the contract period. Additionally, the PLRA Board mandated the use of a registered mobile number for all land record services, with exceptions granted on a case-by-case basis by designated officers. Another major decision was the approval of a One-Go Service Model for Arazi Record Centres, designed to streamline the land transaction process. Currently, citizens must visit multiple counters for services such as obtaining copies of land records or processing property mutations. Under the new model, a single transferring officer will handle all steps, including biometric verification, payment processing and service issuance, at a single counter. This restructuring aims to reduce wait times, eliminate unnecessary delays and improve the overall customer experience. The board approved a pilot implementation at selected ARCs in key districts, including Lahore, Faisalabad, Sheikhupura and Jhang. The board also approved the PLRA Franchising of Services Regulations, 2025, which will allow private franchises to offer Punjab Land Records Authority services in exchange for a licensing fee. This initiative is expected to enhance public accessibility by increasing the number of service outlets across the province while reducing government operational costs. Additionally, it is projected to generate revenue and stimulate local economic growth by creating employment and investment opportunities. Under the plan, franchise fees will be categorised into platinum, gold and silver tiers. PLRA employees who resign to establish a franchise will be exempt from franchise fees for the first three years.
