Housing Downturn Puts $20 Billion Indian Bank Loans at Risk
- Potential buyers of stressed assets wary after realty slump
- Prices weighed down by oversupply of land parcels: Shingwekar
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Indian lenders struggling to recoup loans worth about $20 billion to troubled property developers have to contend with another challenge: A lackluster recovery from the worst home-sales slump this decade.
To recover the dues, banks are taking control of land parcels and unfinished projects that can be sold along with loans. This comes at a time when home sales volumes have declined about 40 percent over four years and prices have dropped as much as 20 percent on average, said S. Sriniwasan, managing director of Kotak Investment Advisors, which oversees the alternate assets business of parent Kotak Mahindra Bank Ltd.