Bad Bank security receipts to get Centre’s backing of ₹30, 600 crore

The government will provide a guarantee of ₹30,600 crore for security receipts issued by the proposed bad bank, finance minister Nirmala Sitharaman said on Thursday, announcing cabinet approval for the plan. The National Asset Reconstruction Co. Ltd (NARCL) is being established as a bad bank to take over non-performing assets, allowing banks to focus on their core business of lending. State-run financial institutions led by Canara Bank will hold a 51% stake in NARCL. “The union cabinet on Wednesday cleared a proposal to provide government guarantee to security receipts issued by National Asset Reconstruction Co.,” Sitharaman told reporters.