MUMBAI, Dec 21 Reuters India39;s Bandhan Bank on Thursday said that it will sell its stressed home loan portfolio to an asset reconstruction company.

The bank has approved the transfer of 7.76 billion rupees 93.23 million in home loans, which were overdue by more than 180 days to an asset reconstruction company ARCs, it said in a release to exchanges.

The bank will recover 36 of this amount or 2.8 billion rupees upfront in cash as part of the sale, it said.

Banks sell assets to ARCs to help reduce the level of bad loans on their books and release the capital they need to set aside against such loans.

Bandhan Bank had a gross nonperforming assets ratio of 7.32 at the end of the September 2023 quarter.

1 83.2387 Indian rupees

Reporting by Ira Dugal; Editing by Eileen Soreng

Source Reuters