Bank of Baroda to move Karnataka high court to restrict NMC founder BR Shetty from selling assets

Earlier this month, a session court in Bengaluru had frozen the asset of the founder of the NMC Health group, restricting BR Shetty and his wife from selling or transferring properties

State-owned lender Bank of Baroda reportedly plans to move the Karnataka High Court (HC) seeking ban on sales of assets, even those not pledged as collateral to the lender, by NMC founder and billionaire businessman BR Shetty. The bank seeks to recover loans worth more than $250 million from Shetty and his companies.

The bank wants to ensure that Shetty does not sell his assets, even those not listed as collateral to the public sector lender, Mint quoted sources close to the development as saying.

Earlier this month, a session court in Bengaluru had frozen the asset of the founder of the NMC Health group, restricting Shetty and his wife from selling or transferring properties claimed as partial security against loans that bank said are personally guaranteed by the businessman. The lower court in Bengalaru will next hear the case on June 8.

According to May 16 court documents reviewed by Reuters, the 16 properties in several Indian cities including Bengaluru were among guarantees put up by Shetty and his wife against Rs 1,913 crore ($253 million) loans.

Also Read: NMC founder BR Shetty owes $250 million to Bank of Baroda

Shetty, a Padma Shri recipient, flew to India in March this year after legal problems increased on NMC Health, one of the leading healthcare chain and distribution business in the United Arab Emirates. The company was placed under administration by a London court in April after the private healthcare provider disclosed that it had debts of $6.6 billion.

Adding to the woes, Finablr, in which Shetty owns a controlling stake, disclosed in April it may have nearly $1 billion more in debt than previously reported, as per Reuters report.

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The Bank of Baroda reported a spike in bad loans during the December quarter. The bank's gross non-performing assets rose to Rs 73,140 crore in Q3 FY20 from Rs 69,969 crore in Q2 F20. The figure at end-December 2018 stood at Rs 74,322 crore. The gross bad loans as a percentage of its total advances stood at 10.43 per cent in the December quarter of FY20, compared to 10.25 in the September quarter of FY20. The bank is yet to announce its earnings for the March quarter.

By Chitranjan Kumar