ICICI Bank teams up with Apollo to set up asset reconstruction company
Posted on:03 Aug 2016 09:14:47
03 August 2016 Current Affairs GK: ICICI Bank has teamed up with private equity major Apollo Global Management to launch an asset reconstruction company.
ICICI and Apollo have signed a memorandum of understanding to set up the ARC, which will acquire debt from lenders and also take equity stakes in borrowers.
AION Fund, which has been established through a strategic partnership between ICICI Venture Funds Management Company and an affiliate of Apollo Global Management, is the third party in the MoU.
The fund has already committed $825 million in investments in the country.
According to RBI, gross non-performing assets of scheduled commercial banks rose to 7.6 per cent in March 2016 and may increase further to 8.5 per cent in 2016-17 as per a base-case scenario.
With asset stress resolution taking the spotlight, the government and the regulators have been making efforts to relax conditions by allowing up to 100 per cent foreign investment in ARCs, subject to conditions.
This has led to many new entities showing interest.
ARCIL, promoted by a slew of lenders including ICICI Bank, used to be the only ARC in the country, but in the last few years, companies promoted by private financial institutions like Edelweiss Finance and Kotak Mahindra Group have come up and have been playing a key role.
The proposed ARC, the statement said, is counting on ICICI Bank's experience in the Indian financial sector and Apollo's investment experience as the strong points.
The objective of the collaboration will be to streamline the operations of borrowers, facilitate deleveraging and arrange additional funding on a case-by-case basis .
FreshersLive - No.1 Job site in India. Fresherslive Current Affairs 2017 section offers informative quiz questions with answers regarding latest current affairs today for all sorts of competitive exams like UPSC, TNPSC , IFS, IAS, IPS, railway exams (RRB) and banking exams like IPBS PO, IPBS clerk, Federal Bank PO, ICICI, SBI, RBI legal officer & Grade officer posts and much more. Register with us to get latest Current Affairs Updates. Also get latest Current Affairs news and quiz Updates for free alerts daily through E-mail