PMC Bank case: Bust bank invites bids for sale of yacht, jets owned by promoters of largest borrower

A troubled cooperative bank which has been under the central bank’s supervision for more than a year has pinned its hopes of a turnaround on the sale of two French-manufactured jet planes. The administrator for Punjab & Maharashtra Co-operative (PMC) Bank on Tuesday invited fresh bids for two aircraft owned by the promoters of the bank’s largest borrower, ostensibly after the failure of the first attempt made earlier this year.

A public notice issued by the administrator sought sealed bids for a Dassault Falcon 2000 and a Bombardier Challenger 300, both currently parked at the Mumbai airport.

In July 2020, PMC Bank had sought the first round of bids for the two jets and a yacht belonging to the promoters of the Housing Development and Infrastructure (HDIL) group, the Wadhawans. It is unclear whether the yacht has found a buyer. Attempts to contact PMC Bank’s recovery cell and administrator AK Dixit were unsuccessful. An email sent to the bank remained unanswered till the time of going to press.

The notice makes no mention of reserve prices for the jets and simply states that the earnest money to be deposited is 10% of the offer amount. Interested bidders will have to submit their bids by February 17, 2021, and the bids will be opened on February 20.

A scheme of resolution for PMC Bank has so far been elusive even as Yes Bank and Lakshmi Vilas Bank were resolved this year. On September 22, 2020, almost exactly a year since the Reserve Bank of India (RBI) superseded the bank’s board, Dixit took over from JB Bhoria as its administrator. Since he took over, PMC Bank has sought expressions of interest (EoIs) from interested investors and received four proposals. According to a recent report by Business Standard, UK-based Liberty Group, a combine of the Centrum group and BharatPe, and two business families from Mumbai and Hyderabad have expressed interest in taking over the bank.

As depositors with the bank continue to hold protests at RBI’s various offices across Mumbai, governor Shaktikanta Das has said the response to the resolution process has been “positive”. During the post-policy press conference on December 4, he had said, “The bank and its management are fully engaged with the investors who had purchased the information memorandum…let us see what is the response and after that we can take a view on this.”