The Reserve Bank of India (RBI) has clarified that banks cannot sell immovable properties acquired during loan recovery proceedings back to the defaulting borrower or related parties.

The central bank said banks are generally not expected to own non-financial assets as part of their regular lending operations. However, in exceptional cases involving non-performing assets (NPAs), banks may acquire collateral properties as part of the recovery process, but such assets cannot be resold to the original borrower or connected entities.