dizzy

so pnb believes that probability of recovery is 50 cents on the dollar in a distressed asset market in which the best bid can be no more than 15 cents under present structures ?

is the opportunity in the equity, stand fast, or flee ?

handicapping risk with a 20 % error rate in a 2 % world ?

http://www.financialexpress.com/article/economy/wilful-defaults-a-third-of-pnb-npas/214853/

Close to a third of Punjab National Bank’s gross non-performing assets (NPAs) of Rs 34,338 crore have resulted from wilful defaults, the lender has said. Of this amount of Rs 10,869 crore, the top 10 wilful defaulters together owe the New Delhi-headquartered bank Rs 3,554 crore.

As at the end December last year, PNB had identified 904 companies as being wilful defaulters and filed cases against some of them. The number at the end of September 2015 was 764 companies and the value of unpaid loans then was Rs 9,204 crore.

Following a speedy clean-up of its portfolio in the wake of a directive from the Reserve Bank of India (RBI), PNB reported slippages of Rs 17,655 crore in Q3FY16 and a pre-tax loss of Rs 858 crore. The slippages left the public sector bank’s impaired loans at 17.4%, comprising 8.5% gross NPAs and 8.9% standard restructured loans.

PNB has made loan loss provisions of Rs 18,758 crore in the three years 2012-13, 2013-14 and 2014-15.

In the current year provisions are expected to be of the order of Rs 9,800 crore; in the nine months to December the amount provided was Rs 7,089 crore. Between FY11 and FY15, the government infused Rs 3,457 crore of capital.

The PNB stock’s market value has been eroded by approximately Rs 12,000 crore since the start of September. The stock closed at Rs 75.65 on the BSE on Monday, down 0.66% over Friday’s close. The stock is trading at a price to book value (P/BV) of 0.29 times for estimated FY17 book value.

http://indianexpress.com/article/business/economy/zoom-developers-banks-issued-guarantees-worth-rs-3000-cr-against-collateral-of-just-rs-150-cr/

Zoom Developers Ltd, which figures prominently on the willful defaulters list, owes Rs 3,002 crore collectively to 26 state-owned banks. According to an investigative audit conducted by the lenders, Zoom has allegedly diverted funds borrowed from these banks to 350-odd subsidiaries, related parties based in India and abroad, and to purchase jewellery for the wife of its promoter, Vijay Chaudhary.

At the same time, however, several of these lenders also issued bank guarantees to the company without due diligence and allowed it to roll over bank guarantees for four years till 2009-10, according to four people familiar with the case.

Moreover, while the banks collectively issued guarantees of Rs 3,000 crore, the collateral with them is only Rs 150 crore, according to a person connected with the audit. Sources didn’t want to be identified as investigations are in progress.

- See more at: http://indianexpress.com/article/business/economy/zoom-developers-banks-issued-guarantees-worth-rs-3000-cr-against-collateral-of-just-rs-150-cr/#sthash.l2LzU7pz.dpuf