Vijaya Bank to convert 50% of Discom debts in to bonds by end of current fiscal

MANGALURU: Vijaya Bank will strive to convert 50 percent of its exposure to distribution companies (Discoms) in to bonds by the end of this fiscal. The bank that is awaiting the nod of its board in this regard, will make full use of union power ministry's UDAY scheme to convert its nearly Rs 9,000 crore of exposure in to bonds, and the remaining 25% debts in to bonds by the end of next fiscal, noted Kishore Sansi, managing director and chief executive officer of the bank. Interacting with reporters after chairing the AGM of Vijaya Rural Development Foundation on Tuesday, Kishore said move to convert Discoms debts in to bonds is a small measure on part of PSBs to come to their rescue. "Moreover these are standard and not stressed accounts," he said foreseeing no risks in converting debts in to bonds. Noting the proposal is at a discussion stage (in the bank), he said, "We will abide by directions from finance ministry in this regard." On move to fund startups as envisaged by PM Narendra Modi, Kishore said the bank has started on this front on a smaller scale. "We are meeting norms of funding SC/ST, women entrepreneurs per branch per year," he said adding the bank as of now has received 60 proposals. The bank will strive to complete their financial requirements by end of this quarter, he said adding this funding (to the startups) is in addition to lending to MSME sector under MUDRA scheme. Referring to vital aspect of bank's operation, namely non-profitable assets (NPAs or read losses), Kishore said, "The bank has launched a war against NPAs." The general managers have fanned out in to the field and even the regional managers are taking all steps necessary to cajole, handhold debtors and strive to either restructure or refinance their loans. In addition, legal steps too are being mulled including asking the debt recovery tribunal to hasten the settlement process. The gross NPA at the end of second quarter ending September 2015 was 3.98% and net NPA stood at 2.84%, Kishore said adding the bank will strive to bring this down to less than 3 and 2 per cent respectively in case of gross and net NPAs by the end of this fiscal. The bank has also done well on the housing and car loans front by achieving last fiscal's lending in first 8-1/2 months of this fiscal. "Whatever further business we do henceforth will be incremental growth," he noted. -TOI