The plan for a bad bank was proposed during the Union Budget for 2021-22.
State-run banks who are working on the “bad bank” want private companies, including asset managers, to own a 51 percent stake in the asset management company (AMC).
The public sector will have a 49 percent stake, but the shareholding ratio is yet to be finalised, Mint reported.
However, private entities with any links to the bad assets housed in the AMC will not be permitted to invest, the report said.
Also read: Will NBFCs be allowed to transfer stressed assets to proposed Bad Bank?
Moneycontrol could not independently verify the story.
“There is interest from the private sector as this presents an opportunity to manage assets worth Rs 2.25 trillion for a management fee. Lenders are discussing the quantum of the management fee that these asset managers will be entitled to,” a source told the Mint.
State-run banks want the private sector to own the majority of the AMC to enable flexibility in decision-making and to avoid the purview of the three Cs: Central Bureau of Investigation (CBI), Comptroller and Auditor General of India (CAG), Central Vigilance Commission (CVC), sources told the paper.
The plan for a bad bank was proposed during the Union Budget for 2021-22. The entity will absorb stressed assets of lenders and will be set up as an asset reconstruction company (ARC)/AMC.
