Banks can't sell back seized assets to defaulters: RBI

RBI has barred defaulting borrowers from repurchasing seized properties under new directions effective October 1, 2026.

Defaulters and related parties as defined under the Insolvency and Bankruptcy Code, 2016, cannot buy back assets from any bank or finance company.

Banks must adopt board-approved policies that set caps on non-financial assets, define eligibility, and document recovery efforts before acquisition.

Banks must dispose of seized assets through public auctions under SARFAESI principles within seven years.

Seized assets must be disclosed separately and excluded from gross NPA, net NPA, and provisioning coverage ratios.