Oriental Bank in debt recast

Calcutta, Jan. 12: Gurgaon- based Oriental Bank of Commerce (OBC) is looking to restructure debts worth Rs 2,500 crore, which it could process by the end of 2012-13.

"We have a restructure pipeline of Rs 2,500 crore. This includes about Rs 1,500 crore of Punjab State Electricity Board, Rs 450 crore of Moser Baer and the rest is in various other accounts," S.L. Bansal, chairman and managing director of the bank, said yesterday. He was in the city to inaugurate the bank's branch at Sector V, Salt Lake.

"The restructuring process could take place within this fiscal. However, if the process is not complete, it can spill over to the next year," Bhupinder Nayyar, executive director of OBC, said.

The bank has a total restructuring book of about Rs 10,500 crore constituting of debts to public sector airline Air India and state distribution companies (discoms). It also has an exposure of Rs 55 crore in Kingfisher Airlines, which has turned into a non performing asset as the airline is not servicing interest payments.

Bansal said the bank was looking to make a provision for the Kingfisher account before the end of this fiscal. The entire restructuring procedure is expected to put pressure on the bank's bottom line, he added.

The bank is also looking to increase its business by about 11 per cent to Rs 3,00,000 crore by March.


Get stories like this on the Yahoo app and discover more every day.
Download it now.