ESAF Small Finance Bank Share Price Surges as Board Approves Sale of ₹1700 Crore Bad Loans to ARC

ESAF Small Finance Bank has approved a major balance-sheet clean-up through the sale of stressed assets.  

The decision was taken at a Board meeting held on Friday, December 12, and forms part of the bank’s ongoing efforts to address asset quality pressures. 

Approval for NPA sale and transaction structure 

The Board has cleared the sale of up to ₹1,700 crore worth of non-performing assets and technically written-off loans to an Asset Reconstruction Company (ARC). The identified pool carries a provision coverage of 94%.  

The bank has authorised its Asset Sale Committee to negotiate and finalise the valuation through the Swiss challenge method, as disclosed in its regulatory filing. 

Governance changes and asset quality context 

At the same meeting, the Board noted the retirement of 4 directors - Shri Ajayan Mangalath Gopalakrishnan Nair, Shri Ravi Venkatraman, Shri Gabriel John Samuel (effective December 12, 2025) and Shri Ravimohan Periyakavil Ramakrishnan, who steps down as Part-Time Chairman and Independent Director on December 20, 2025.  

Several Board committees, including Audit, Risk Management, Stakeholders Relationship, and CSR & Sustainability Committees, have been reconstituted with effect from December 13, 2025. 

Read More: Utkarsh and ESAF Small Finance Banks Plan for Equity Raise! 

ESAF Small Finance Share Price Performance  

As of December 15, 2025, at 10:50 AM, ESAF Small Finance Bank share price is trading at ₹25.80 per share, reflecting a surge of 0.58% from the previous closing price. Over the past month, the stock has declined by 3.91%.  

Conclusion  

The sale of stressed assets marks a decisive step by ESAF Small Finance Bank to strengthen its balance sheet amid sustained asset quality challenges. With high provisioning already in place, the transaction is expected to reduce credit stress, while recent governance changes aim to support improved oversight and long-term stability. 

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