Banks have written off non-performing assets (NPAs) or bad loans worth about ₹16.35 lakh crore in last 10 financial years, Parliament was informed on Monday.
Highest amount of ₹2,36,265 crore was written off during financial year 2018-19 while NPAs worth ₹58,786 crore were written off in 2014-15, the lowest in the last 10 years.
During 2023-24, banks wrote off bad loans of ₹1,70,270 crore, lower than ₹2,16,324 crore done in the previous financial year.
Banks write off non-performing assets (NPAs), including those in respect of which full provisioning has been made on completion of four years, as per the Reserve Bank of India (RBI) guidelines and policy approved by banks’ boards, Finance Minister Nirmala Sitharaman said in a reply in the Lok Sabha.
Such write-offs do not result in waiver of liabilities of borrowers and therefore, it does not benefit the borrower, she said.
Banks continue pursuing their recovery actions initiated against borrowers under the various recovery mechanism available to them, such as filing of a suit in civil courts or in Debts Recovery Tribunals, action under the Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest Act, filing of cases in the National Company Law Tribunal under the Insolvency and Bankruptcy Code, etc, she said.
As per RBI data, as on December 31, 2024, scheduled commercial banks had 29 unique borrower companies, which have been classified as NPAs and each of them have outstanding of ₹1,000 crore and above, she said, adding aggregate outstanding in these accounts were ₹61,027 crore.
{{/usCountry}}As per RBI data, as on December 31, 2024, scheduled commercial banks had 29 unique borrower companies, which have been classified as NPAs and each of them have outstanding of ₹1,000 crore and above, she said, adding aggregate outstanding in these accounts were ₹61,027 crore.
{{/usCountry}}With regard to recovery of overdue amount from borrowers, banks make calls and issue emails/letters to borrowers regarding payment of the overdue amounts, and depending on the default amount, banks may also approach the National Company Law Tribunal for initiation of corporate insolvency resolution process in case of corporate borrowers.
Further, if a loan account is classified as NPA, banks initiate recovery actions, as per their Board-approved policies, which include filing of a suit in civil courts or in debts recovery tribunals, and, action under the Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest Act, she added.
Replying to another question, Sitharaman said it has been decided by the government to constitute the 8th Central Pay Commission (CPC).
The financial implication of the recommendations of the 8th Central Pay Commission will be known, once the recommendations are made by the 8th Central Pay Commission and accepted by the government, she said.