Tag: sarfaesi act

Canara Bank receives e-bids for 14 lakh sq ft Supreme Business Park in Mumbai; reserve price Rs 1,370 cr

Banking & Finance

[ad_1]

Read More/Less


Canara Bank put the property up for auction under SARFAESI, seeking to recover Rs 385 crore after the loan to the property developer Supreme Housing and Hospitality Pvt Ltd. Image: Representational

State-run lender Canara Bank has received e-bids for sale of Supreme Business Park — a 1.28 lakh sq meter (about 14 lakh sq ft) commercial property with a built-up area of over 6.9 lakh sq feet in Powai, Mumbai. Canara Bank put the property up for auction under SARFAESI, seeking to recover Rs 385 crore after the loan to the property developer Supreme Housing and Hospitality Pvt Ltd turned bad. The reserve price for Supreme Business Park is kept at Rs 1,370 crore. The excess amount recovered will be given back to the borrower — Supreme Housing, an official told Financial Express Online. The bids will be opened on 30 March 2021.

Supreme Housing and Hospitality took a loan from Canara Bank in 2016, which later turned into NPA (non-performing asset). Under Sarfaesi Act, the bank can recover its dues by selling the securities. Canara Bank has applied for the physical possession of the entire property. The last date for the bid application submission was March 25, 2021. However, if the auction doesn’t go through for any reason this time, then it would reopen for bids. The E-auction agency is C1 India, and the prospective bidders could participate in the bidding process from anywhere.

According to the e-auction notice seen by Financial Express Online, the commercial property has two towers A and B. The building number 2 known as ‘Supreme Business Park’ consists of two wings, A and B. These wings have 4 stilts and 7 upper IT floors. The size of the mortgaged asset is 1.28 lakh sq meters, and it is owned by Bhawani Shankar Sharma.

Earlier this week, Canara Bank had announced to organise an auction of 2,000 borrower properties on March 26, 2021. The properties include residential flats, apartments, independent houses, industrial lands, commercial complexes, office spaces and vacant lands. These will be sold under the provisions of the Sarfaesi Act, PTI quoted an official statement. According to the statement, so far in the current financial year, Canara Bank has sold 1,450 properties valued at Rs 886 crore. The properties put up for auction are spread across Delhi, Mumbai, Kolkata, Bengaluru, Chennai, and also other semi-urban pockets.

Get live Stock Prices from BSE, NSE, US Market and latest NAV, portfolio of Mutual Funds, Check out latest IPO News, Best Performing IPOs, calculate your tax by Income Tax Calculator, know market’s Top Gainers, Top Losers & Best Equity Funds. Like us on Facebook and follow us on Twitter.

Financial Express is now on Telegram. Click here to join our channel and stay updated with the latest Biz news and updates.



[ad_2]

CLICK HERE TO APPLY

Leave a comment , , , , , , ,

RBI may buy out Centre’s 51% stake in CERSAI

Banking & Finance

[ad_1]

Read More/Less


The Reserve Bank of India (RBI) may pick up the Government’s 51 per cent stake in the Central Registry of Securitisation Asset Reconstruction and Security Interest of India (CERSAI).

CERSAI, which is a Government of India company, operates the central registry dealing with the filing of security interest of immovable, movable, intangible properties and assignment of receivables, among others, by lenders.

As these activities are essentially related to banks and non-banking finance companies, the finance ministry is believed to have sought RBI’s opinion on the possibility of it picking up the Government’s entire stake, said an official of one of the company’s shareholders.

RBI will be better placed to further develop and regulate CERSAI, he added.

While the Centre holds 51 per cent stake in CERSAI, the balance 49 per cent stake is held by select public sector banks, including State Bank of India, Punjab National Bank and Bank of Baroda, and the National Housing Bank.

CERSAI was set up in 2011 under Section 20 of the Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002 (SARFAESI Act). The company is licensed under Section 25 of the Companies Act 1956.

May need amendment to SARFAESI Act

An amendment to the SARFAESI Act may be needed so that RBI can pick up the Government’s 51 per cent stake in CERSAI, said a senior public sector bank official.

The Central Registry was set up in 2011 to prevent frauds in loan cases involving multiple lending from different banks on the same immovable property.

As per a 2011 RBI notification, the records maintained by the Central Registry are available for search by any lender or any other person desirous of dealing with the property.

Availability of such records can prevent frauds involving multiple lending against the security of same property as well as fraudulent sale of property without disclosing the security interest over such property, it added.

CERSAI has also been entrusted with the responsibility of operating and maintaining a Central KYC Record Registry (CKYCRR), which started operating from 2016. This registry is governed under the Prevention of Money Laundering Rules 2005 (Maintenance of Records).

The CKYCRR caters to Reporting Entities (REs) of all four major regulators of the financial sector — RBI, SEBI, IRDAI and PFRDA.

[ad_2]

CLICK HERE TO APPLY

Leave a comment , , , , ,

NBFCs can initiate recovery in Rs 20-lakh loan default under SARFAESI Act: FM

Banking & Finance

[ad_1]

Read More/Less


In the absence of lower threshold limits, NBFCs had to file cases at civil courts for recovery.

Finance minister Nirmala Sitharaman has proposed to lower the threshold for non-banking financial companies (NBFCs) to initiate recovery proceedings against loan defaulters under the Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest (SARFAESI) Act, 2002. In her Budget speech, the FM proposed to lower the threshold of loan defaults to `20 lakh, compared to `50 lakh earlier.

“To improve credit discipline while continuing to protect the interest of small borrowers, for NBFCs with minimum asset size of `100 crore, the minimum loan size eligible for debt recovery under the SARFAESI Act, 2002, is proposed to be reduced from the existing level of `50 lakh to `20 lakh,” she said.

Veena Sivaramakrishnan, partner, Shardul Amarchand Mangaldas, said reducing the amount for taking SARFAESI action will provide lenders better access to fast track and out of court enforcement mechanism, which would lead to better discipline in the financing world. “The borrowers can no longer use long-drawn litigation as an excuse to delay on their contractual obligations and it is, therefore, a crucial step in ensuring quick recovery, which is a critical pillar in any financing,” she added.

Sonam Chandwani, managing partner at KS Legal and Associates, said relaxation in threshold for NBFCs under SARFAESI is likely to strengthen financial health of lenders and simultaneously improve credit discipline while continuing to safeguard borrowers’ interests.

“This move enables NBFCs to recover smaller loans thereby catering to a larger pool of loans, which ultimately strengthens their balance sheets and overall financial health,” she said.

FE learned that NBFCs had earlier requested the finance minister to reduce threshold limits for initiating recovery proceedings. In the absence of lower threshold limits, NBFCs had to file cases at civil courts for recovery. The recovery under SARFAESI is applicable only to secured loans. Under the SARFAESI Act, a lender can take possession of the property or mortgaged assets after a 60-day notice. The Act is applicable to home loans, loan against property and loan against collateral for micro small medium enterprises (MSMEs).

Get live Stock Prices from BSE, NSE, US Market and latest NAV, portfolio of Mutual Funds, Check out latest IPO News, Best Performing IPOs, calculate your tax by Income Tax Calculator, know market’s Top Gainers, Top Losers & Best Equity Funds. Like us on Facebook and follow us on Twitter.

Financial Express is now on Telegram. Click here to join our channel and stay updated with the latest Biz news and updates.



[ad_2]

CLICK HERE TO APPLY

4 Comments , ,