SBI to spin off Rs 5000 cr stressed assets

 State Bank of India (SBI) will hive off Rs 5,000 crore of stressed assets into a separate division.

 This follows recommendations by consultants McKinsey & Co, appointed to draft a business process re-engineering exercise for the bank.  The executive committee of the SBI recently approved the setting up of the new division.  The stressed assets division, to be headed by chief general manager T M N Singh, will look after all the impaired loans of the bank. Additionally, it will also have charge over the written-off accounts for recovery possibilities. Singh was earlier in charge of both credit and non-performing assets (NPAs) at SBI.  The net NPAs of SBI as on March 31, 2004, was at Rs 5,440 crore (3.48 per cent) and gross NPAs was at over Rs 12,000 crore. SBI is aiming for a net NPA to net advances ratio of 2 per cent by March 2005 which would work out to Rs 2,500 crore.  As part of the move, nine rehabilitation and recovery branches of SBI will now come directly under the stressed assets division. This will give focussed attention on this activity, said bank officials. Earlier, the nine branches functioned under local head offices.  The bank has recently completed its the restructuring exercise carved out a whole new structure with seven main divisions or profit centres.  These divisions