Punjab National Bank (PNB) has sold entire 21% stake in ISARC

Punjab National Bank (PNB), a government-owned bank, has announced that it has sold its entire 21% stake in India SME Asset Reconstruction Company Limited (ISARC) for ₹34 crore.

Punjab National Bank has now fully exited from ISARC by selling all its shares for ₹34 crore. This decision comes after RBI’s approval of a new sponsor and investment plans for the company. Despite ISARC making a good profit last year, PNB has decided to sell its stake as part of its business strategy.

What is ISARC?

ISARC is an Asset Reconstruction Company (ARC). It helps banks recover bad loans (loans that are not being repaid) from small and medium businesses (SMEs). Before the sale, ISARC was jointly promoted by:

• SIDBI (Small Industries Development Bank of India)
• Bank of Baroda
• Punjab National Bank
• SIDBI Venture Capital Ltd

These institutions had invested in ISARC to help in cleaning up bad loans from the banking sector.

What has happened now?

• On Tuesday, PNB said that it has sold its full shareholding in ISARC, which was 21% of the company.
• In total, PNB sold 2.09 crore shares at a price of ₹16.29 per share.
• The total money PNB received from this sale is ₹34.04 crore.

Background of the Deal

• In March 2025, the Reserve Bank of India (RBI) approved two things:
  1. A change in sponsor of ISARC.
  2. A plan to raise more equity investment from a company named Authum Investment and Infrastructure Ltd.
• In May 2025, PNB had signed an official agreement to sell all of its shares in ISARC.
• As of June 2025, the sale has now been completed.

Financial Performance of ISARC

For the financial year ending March 31, 2025:

• ISARC made a net profit of ₹19.79 crore.
• Its total income (revenue) was ₹36.4 crore.