Home Market Kotak Mahindra to explore bad-loan AMC opportunities

Kotak Mahindra to explore bad-loan AMC opportunities


Kotak Mahindra Bank is evaluating opportunities to invest in the proposed bad loan asset management company.

“I think we will look at it positively the construct (of the AMC) is interesting and it helps in the entire process of resolution before the company goes through the IBC process,” said Dipak Gupta, joint MD, Kotak Mahindra Bank. “We are evaluating it. Its too preliminary at this stage but it looks interesting.”

The Sunil Mehta Committee set up by the finance ministry has backed the idea for setting up of an asset management company to help banks come out of the bad loan menace.

The alternative investment fund, proposed by state-run banks under the five-pronged resolution plan drafted by them, will look to raise funds from domestic investors and sovereign wealth funds. Under the structure proposed to the government, the asset management fund would allow promoters to retain a less than 24per cent in the assets which it takes over for resolution.

The government had accepted the proposals and that there could be more than one such AMC. The initiative has been dubbed Project Sashakt. Under the plan, banks will consolidate their loans and approach the proposed asset management company for faster and transparent resolution of loans.

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