SBI to sell Rs 38.15 billion KSK Mahanadi loan to Aditya Birla ARC

SBI is planning to sell its Rs 38.15 billion outstanding loan from KSK Ma­hanadi Power to the Aditya Birla Asset Reconstruction Company (ARC), thereby bolstering its earnings for the quarter ending in June 2022. The bank declared the Rs 15.44 billion bid by Aditya Birla ARC to be the highest. This will be the largest sale of distressed loans with an upfront payment by any bank, representing a 40 per cent recovery. Aditya Birla ARC would gain control over 34 per cent of KSK Mahanadi Power’s loans, the critical level required by the Insolvency and Bankruptcy Code, upon acquiring SBI’s loans. If 34 per cent of lenders vote against a resolution, it will not be approved.