Axis Bank sells part of Echanda Urja loans to IREDA, Central Bank

Axis Bank sells part of Echanda Urja loans to IREDA, Central Bank

Axis Bank, which has the largest exposure to Echanda Urja Pvt Ltd, a subsidiary of NuPower Renewables Pvt Ltd, has sold part of its loans to government-owned Indian Renewable Energy Development Agency (IREDA) and Central Bank of India in 2017-18, in a bid to reduce exposure in the company.

With this, Axis Bank has reduced its exposure in Echanda Urja by Rs 2 billion to below Rs 3 billion, and the rest of the debt will also be sold in due course, said a source close to the development.

When contacted, an Axis Bank spokesperson said: "As a policy, the bank does not comment on client specific exposures. You may refer to the credit ratings of the company, according to Care Ratings."

Care Ratings rated Echanda Urja’s debt instruments worth Rs 4.75 billion as “A Minus” with stable outlook on February 28 this year.

An email sent to NuPower Renewables did not elicit any response.

An Axis Bank official said the loans were sold as part of the bank's ongoing process to restructure its portfolio. The loan was taken over in 2015 as part of refinancing of earlier loans taken by the company from public sector banks, the source said.

The sale of loans by Axis Bank follows NuPower Renewables restructuring its loans with banks led by Central Bank of India and Canara Bank in 2015. Loss-making NuPower Renewables, owned by Deepak Kochhar, husband of ICICI Bank MD and CEO Chanda Kochhar, is currently making news for all the wrong reasons.