14 banks struggle to recover Rs 3,635 crore from Mumbai co.

Quaid Najmi

Mumbai: A consortium of 14 public sector banks, led by the Bank of India (BoI) on Friday initiated the process to recover staggering loans totally worth Rs3,635.25 crore from a Mumbai-based defaulter, Frost International Ltd.

Banking circles describe this as a revelation of one of the biggest defaulters in recent months, comparable to the league of big-time debtors like absconding diamantaires Nirav Modi, Mehul Choksi and the Sterling Biotech Group.

Besides BoI, the other banks of the consortium are: the Bank of Baroda, the Canara Bank, the Central Bank of India, the Andhra Bank, the Oriental Bank of Commerce, the Punjab National Bank, the Syndicate Bank, the Union Bank of India, the Indian Overseas Bank, the UCO Bank, Vijaya Bank, Allahabad Bank, and the United Bank of India.

Of these, only two banks —BoI and BoB — have outstanding of a whopping Rs606.17 crore and Rs526.05 crore, respectively, from Frost International Ltd, an unlisted company.

The lowest outstanding is shown for Andhra Bank, at Rs47.85 crore, while the other banks are in the range of Rs100 crore-Rs 390 crore.

A government-recognised trading house, the 25-year-old company deals in metals, minerals, petro products, textiles, fabrics, agro-commodities, equipments and other items and has a global presence in 25 countries.

For starters, the banks’ consortium has slapped notices on the company and threatened to seize its immovable assets in some prime localities of suburban Mumbai.

These include four offices with car park slots in the Meadows commercial complex in Andheri E, shops No. 1-4 in Oberoi Chambers-1, owned by Globiz Exim Pvt Ltd shops No. 101-108 on the same premises belonging to NSD Nirman Pvt Ltd, and two offices in Crystal Plaza, Andheri W, owned by Sunil Verma.

The banks’ consortium has served a 60-day ultimatum to the defaulter to clear the pending dues plus interest as applicable to each bank.

Frost International Ltd’s registered office is in Bandra Kurla Complex, Mumbai, its head office and international marketing division is in Hospitality District, New Delhi and the corporate office is in Kanpur.

Despite repeated attempts by IANS to contact all its offices, none of the top management, including its directors, were available for comments on the matter.

The bank consortium’s latest action is significant in the wake of the proposed merger of various nationalised banks in which two banks—BoI and BoB— will continue as independent entities.

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