All section Close
Banks Wrote Off Bad Loans Worth Rs 1.15 Lakh Crores In Nine Months Of Current Financial Year: Govt
Writer: Navya Singh
Navya writes and speaks about matters that often do not come out or doesn’t see daylight. Defense and economy of the country is of special interest to her and a lot of her content revolves around that.
India, 9 March 2021 10:54 AM GMT
Editor : Shweta Kothari |
A broadcast turned digital journalist, Shweta Kothari heads the newsroom at The Logical Indian. She has previously worked with CNBC and NewsX as a news anchor and senior correspondent. Shweta holds a masters degree in journalism from the university of Sussex, UK and started her career with work placement with BBC in Scotland.
Creatives : Rajath
A free spirit who find meaning in life with the virtue of creativity and doing job par its excellence, animal lover and traveller by heart.
"Banks evaluate the impact of write-offs as part of their regular exercise to clean up their balance-sheet, avail tax benefit and optimise capital in accordance with RBI guidelines and policy approved by their boards," the minister said.
Banks wrote off bad loans worth Rs 1.15 lakh crore during the first three-quarters or nine months of the current fiscal year, the central government told Lok Sabha on Monday, March 8.
"As per RBI guidelines and policy approved by bank boards, non-performing loans, including those in respect of which full provisioning has been made on completion of four years, are removed from the balance-sheet of the bank concerned by way of a write-off," minister of state for finance Anurag Singh Thakur said in a written reply.
"Banks evaluate the impact of write-offs as part of their regular exercise to clean up their balance-sheet, avail tax benefit and optimise capital in accordance with RBI guidelines and policy approved by their boards," he said.
The minister said that as per RBI data, scheduled commercial banks (SCBs) have written-off loans of Rs 2,36,265 crore, Rs 2,34,170 crore and Rs 1,15,038 crore during FY2018-19, FY2019-20 and the first three-quarters of FY2020-21 respectively, reported The Wire.
Emphasising the recovery of written-off bank loans, the minister said, as per RBI guidelines, banks need to have a loan recovery policy that mentions the manner of recovery of dues, period-wise targeted level of reduction in non-performing assets.
"A number of recovery mechanism are available to banks to effect recoveries, 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, 2002, filing of cases in the National Company Law Tribunal under the Insolvency and Bankruptcy Code, 2016, through negotiated settlement/compromise, and through the sale of non-performing assets," the minister said.
According to RBI data, during the last two financial years and the first three quarters of the current financial year, SCBs recovered an amount worth Rs 3,68,636 crore, including the recovery of Rs 68,219 crore from written-off loan accounts.
Thakur also said non-performing assets of banks have decreased by Rs 2,79,627 crore to Rs 7,56,560 crore as of December 31, 2020, on the back of the government's system of recognition, resolution, recapitalisation and reforms.
In response to another question, Thakur also said that various measures have been used to check unauthorised digital lending platforms.
Ministry of Electronics and Information Technology has blocked 27 loan lending apps under Section 69A of the Information Technology Act, 2000 to prevent fraudulent activities of lenders, Thakur said.
Also Read: Delhi High Court Issues Notice To Centre On Plea Challenging New Digital Media Rules
Must Reads
We are an independent and public-spirited digital media platform for Indian millennials. We report news and issues that matter as well as give you the opportunity to take action.
