HDFC to sell Rs 1,000 crore real estate loan portfolio

13 Mar 2023 , 09:01 AM

Prior to its proposed merger with HDFC Bank, Housing Development Finance Corporation (HDFC) is in the process of selling real estate loans totalling up to Rs1,000 crore that relate to two projects, according to news reports.

According to them, the mortgage lender has hired the consulting firm Alvarez & Marsal to look for potential buyers for the debt.

The lender has decided to sell the two loans since they cannot be transferred to the bank due to tougher banking regulations, despite the fact that they are not yet non-performing accounts.

Two payments will be made for the sale. According to both reports, the first auction will take place on Tuesday and the second will happen in the final week of March.

According to a third source, HDFC may decide to sell a sizable pool of loans totalling more than Rs1,500 crore depending on the reaction it receives from purchasers in this round.

For the third quarter of FY23, HDFC recorded gross NPAs of 1.23%. According to reports, HDFC recovered 47% of its losses when it sold four corporate accounts to Assets Care and Reconstruction Enterprise (ACRE) in June of last year for Rs270 crore instead of the total loan amount of Rs577 crore. An Rs1,180-crore loan from HDFC was once more purchased by ACRE in October for Rs602 crore, resulting in a 51% recovery for the mortgage lender.

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