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Public sector lender Bank of Maharashtra, which has seen its gross non performing assets growing to 2.77% of advances, has launched a one-time standardised settlement scheme for recovery of outstanding loans amounting to Rs 800 crore.
"We have launched the one-time settlement scheme mainly for small loans with a size of Rs 5 lakh with some concessions. Our aim is to recover these non-performing assets by incentivising the borrowers who have not repaid their loans for a long time. The scheme will mainly benefit housing loan and micro business enterprises to settle their dues," Sushil Muhnot, chairman and managing director told reporters, here on Friday.
He said depending on the response the Bank aims to increase the ticket size up to Rs 10 lakh. However, he ruled out the possibility of extending the one-time settlement scheme to large and mid-segment corporate borrowers. The Bank's gross NPAs are in the range of Rs 2,500 crore as on September 2013, he said.
The Bank’s total advances stand at Rs 88,000 crore as of September 2013.
The NPAs from the large corporate customers runs into over Rs 1,500 crore, he added.
"With this scheme in place, we aim to bring down our gross NPA level to 2% by end of the current fiscal," he said.
The Bank's focus would be on growing retail and MSME loan books in the coming year. The Bank plans to open 34 retail and MSME loan processing centres across the country to strengthen the expansion of advances to these two sectors, Muhnot said after visiting the Bank's zonal office for the first time after taking over as CMD recently.
Currently, the retail and MSME sectors account for 11% and 16% of the total advances respectively. The Bank aims to expand the business in these two sectors to 15% and 20% respectively by March end, he said.
“We have been very strong in large corporate and agriculture loan segments till now. Henceforth, we are looking at growing our retail and MSME sectors, which are growth areas,” Muhnot added.
