Bad loans worth Rs 14.56 lakh crore have been written off in the last nine years

Parliament was informed on Monday that in the last nine financial years starting 2014-15, banks have written off loans worth Rs 14.56 lakh crore. Of the total Rs 14,56,226 crore, the loans written off to large industries and services were Rs 7,40,968 crore.

Minister of State for Finance Bhagwat Karad said in a written reply in the Lok Sabha that Scheduled Commercial Banks (SCBs) have recovered a total of Rs 2,04,668 crore in written-off loans, including corporate loans, from April 2014 to March 2023.

He informed in another reply that loans written off during the financial year (FY) 2017-18 in public sector banks (PSBs) Net recovery in loans written off during the financial year (FY) Net write-off) was Rs 1.18 lakh crore. Which has come down to Rs 0.91 lakh crore in FY 2021-22 and Rs 0.84 lakh crore in FY 2022-23 (RBI Provisional Data).

He said that the net write-off of loans by private sector banks in the financial year 2022-23 was Rs 73,803 crore. Net write-offs as a percentage of initial gross loans and advances in private sector banks in FY 2017-18 and FY 2022-23 were 1.25 per cent and 1.57 per cent respectively, and for PSBs it was 2 per cent and 1.12 per cent .

He said that comprehensive steps have been taken by the government and RBI to reduce and recover NPAs, due to which the gross NPAs of PSBs have come down from Rs 8.96 lakh crore as on March 31, 2018 to Rs 4.28 lakh crore by March 31, 2023 Is. Talking about the various steps taken by the government in this regard, he said that the Securitization and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002 has been amended to make it more effective.

The minister said that the pecuniary jurisdiction of the Debt Recovery Tribunal has been increased from Rs 10 lakh to Rs 20 lakh so that the DRTs can focus on high value cases, resulting in higher recovery for banks and financial institutions. In addition, he said, the National Asset Reconstruction Company Limited (NARCL) has been set up as an asset reconstruction company with the objective of resolving stressed assets of over Rs 500 crore.

He said the government has also approved giving guarantees of up to Rs 30,600 crore to lending institutions to return security receipts issued by NARCL to acquire stressed loan assets. Answering another question, Karad said the board of State Bank of India in its meeting held on June 9, 2023, had approved raising Rs 50,000 crore, which would constitute Basel III compliant AT-1 bonds. Is. 20,000 crore, Tier-II bonds up to an amount of Rs 10,000 crore and infrastructure bonds up to an amount of Rs 20,000 crore by the bank during FY 2023-24.