City-based RBF Nidhi Ltd has declared that of the total loans that are outstanding in its books amounting to Rs 490 crore, loans worth Rs 163 crore are irrecoverable as they are not secured.
The irrecoverable loans were sanctioned to J M Pandey, Pradeep Kothari and the Alsa group which owe Rs 87 crore, Rs 40 crore and Rs 36 crore to RBF Nidhi.
The Balaji group alone owes the nidhi Rs 231 crore. It has already repaid Rs 35 crore and will soon be repaying another Rs 50 crore, A R Rao, chairman, RBF Nidhi, said, while talking to newspersons.
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The other borrowers who owe Rs 96 crore have been contacted individually and the nidhi is hopeful of collecting a substantial amount in the next 12 months. These are secured loans.
It may be recalled that RBF Nidhi started defaulting on deposits in September 1999 when deposits started drying up.
The problem began in April 1996 when the nidhi was repaying depositors by drawing upon fresh deposits. Actual collections out of accrued interest worked out of around 50-60 per cent annually.
When the fresh flow of deposits completely dried out by April 1999, the nidhi was unable to repay even the interest on deposits.
Subsequently, in February 2000, the board of RBF Nidhi was reconstituted with A R Rao as the chairman.
The new eight-member board found that the nidhi had lent large amounts to a few groups of people whose business failed or had a liquidity problem and hence were unable to repay the nidhi, Rao said.
The board has now submitted a plan to repay depositors with the nidhi to the Company Law Board.
The CLB has approved the repayment scheme in-principle and also made its own recommendations to the plan. Depositors' money will be repaid as and when the nidhi raises funds for repayment, Rao said.
In the first tranche, the nidhi will repay Rs 60 crore. Depositors will be repaid at the rate of 10 per cent of the amount due starting from July 1, Rao said.
However, the nidhi will repay a minimum of Rs 2,000 to 48,000 depositors to start with. The nidhi has a depositor base of 1,85,000.
Since it currently holds Rs 35 crore in cash, the CLB has proposed that 5 per cent of the dues may be repaid by June 5 and the balance after Rs 60 crore is collected.