Private sector lender Yes Bank's Board Credit Committee on Thursday (September 15) has approved the transfer of non-performing assets (NPAs) to US-based private equity firm JC Flowers, sources privy to the developments told CNBC-TV18.

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The bank is likely to give the final nod for the transfer of assets in the September 20 meeting, sources in the know told CNBC-TV18.

Back in July, Yes Bank had selected JC Flowers ARC as a partner to form an asset reconstruction company (ARC) to sell bad loans of the bank valued at Rs 48,000 crore.

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The lender said it has signed a binding term sheet with JCF ARC LLC and JC Flowers Asset Reconstruction Pvt Ltd (JF Flowers ARC) for strategic partnership in relation to the sale of identified stressed loans of the bank.

Having subsequently fulfilled the requisite pre-conditions, the term sheet has become effective from July 15, 2022, Yes Bank said in a regulatory filing.

"Accordingly, the bank has decided that JC Flowers ARC will be a base bidder for a proposed sale of an identified stressed loan portfolio of the bank aggregating to up to Rs 48,000 crore," it said earlier.

As per Reserve Bank of India guidelines, Yes Bank said it proposes to run a transparent bidding process on a Swiss Challenge basis for the sale of the such portfolio using JC Flowers ARC's bid as the base bid.

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JC Flowers already has a presence in India through its existing ARC. The JC Flowers ARC was set up as a three-way joint venture between Eight Capital with a 35 percent stake, London-based hedge fund Emso Asset Management with a 15 percent stake, and JC Flowers & Co with a 50 percent stake. However, earlier this year, Eight Capital pulled out of the joint venture.

(Edited by : Shoma Bhattacharjee)

First Published:Sept 15, 2022 9:20 PM IST