IDBI Bank Ltd has set an aggressive three-year target of doubling its business and sharply reducing bad assets, the lender said, a day after the government said it would consider ceding control of the state-run bank through a share sale.
The bank said it expects to double its business to 10 trillion rupees (USD 147.2 billion) and cut its gross non-performing assets (NPAs) to less than 3 percent by financial year ending March 2019.
That compares to gross NPAs of 8.94 percent in the most recently concluded Oct-Dec quarter when the company posted a loss of 21.84 billion rupees (USD 321 million).
The bank said it expects to be a "near zero net NPA" lender by financial year 2019 by stepping up efforts to recover bad loans.
State-run lenders are bracing for a capital shortage to meet new global banking regulations and the finance ministry will inject USD 3.7 billion to recapitalize government-run banks this year alone, in a sector-wide bailout estimated to cost USD 26 billion over four years.
Officials say Finance Minister Arun Jaitley's announcement in his budget speech that the government would consider cutting its stake in IDBI Bank to below 50 percent is likely to be a test case of India looking at privatising state-run banks.
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