Exposure of banks, financial institutions to real estate to 100 billion dollars; 67% safe loans, according to Anarock

Banks and other financial institutions have $ 100 billion in exposure to the real estate industry, 67% of which are secure while the remaining loans are under pressure or severely stressed, according to real estate consultant Anarock.

“At least 67% (or about $ 67 billion) of total loan advances ($ 100 billion) to Indian real estate by banks, NBFCs and HFCs are currently completely stress free,” Anarock Capital said. , a subsidiary of Anarock, in a press release. statement Monday.

Another 15 percent (roughly $ 15 billion) is under some pressure but has room for resolution with certainty on at least the principal amount.

“$ 18 billion (or 18%) of all Indian real estate loans are under ‘severe’ stress, implying that there has been a strong leverage effect on the part of the developers involved. who have limited or extremely low debt service visibility due to several factors, ”the statement said.

Contribution of NBFCs and HFCs

Anarock Capital said the aggregate contribution of non-bank financial corporations (NBFCs) and housing finance corporations (HFCs), including umbrella companies, to total Indian real estate loans is 63%.

Individually, banks hold a 37 percent share, followed by HFCs at around 34 percent and NBFCs at 16 percent. About 13 percent of the loans were granted under trusteeship.

According to Anarock Capital, banks and HFCs are much better placed with 75% and 66% of their loan portfolios in a comfortable position.

“Not surprisingly, nearly 46% of total NBFC loans are on the watch list,” the statement said.

About 75 percent of total Class A developer loans are secure.

“This presents a comfortable outlook because of the total loans granted to real estate, more than 73 billion dollars are granted to class A builders,” the statement said.

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Marianne R. Winn

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