Banks Bad Loans

Banks have written off bad loans worth Rs 10,09,511 crore during the last five financial years, finance minister Nirmala Sitharaman informed Parliament on Tuesday. The non-performing assets (NPAs), 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 write-off, she said in a reply to Rajya Sabha. "Banks write off NPAs 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. As per inputs received from RBI, Scheduled Commercial Banks (SCBs) wrote off an amount of Rs 10,09,511 crore during the last five financial years," she said. As borrowers of written-off loans continue to be liable for repayment and the process of recovery of dues from the borrower in written-off loan accounts continues, write-off does not benefit the borrower, she said. Banks continue

The lender's net interest income improved 12.83 per cent YoY to Rs 35,183 crore for Q2FY23, against Rs 31,184 crore last year

The department will also take stock of the banks' asset quality, and focus on large bad loans, implementation of the Centre's various schemes, and the lenders' plan to raise capital

PM Narendra Modi had said that freebies will restrict India from becoming self-reliant and increase the burden on taxpayers

The CPI(M) hit out at Prime Minister Narendra Modi over his freebies remarks and said that the only freebies on offer were the loan waivers to "crony" industrialists

Fall in non-interest income, rise in bad loan provisions drag down company's net

Union Bank of India expects to recover Rs 15,000 crore from bad loan accounts during the current fiscal year, and a bulk of this would come from accounts undergoing insolvency resolution process. It expects to make recoveries worth Rs 10,000 crore from accounts under the National Company Law Tribunal (NCLT) for resolution of bad loans in 2022-23, the bank said during an analysts conference call post June 2022-23 quarter earnings announcement last week. Replying to a question on recovery guidance for full year 2022-23, Managing Director and Chief Executive Officer A Manimekhalai said: "The recovery will be around Rs 15,000 crore." Besides, the public sector lender is also likely to shift a few accounts under the newly incorporated debt resolution company NARCL. A total of 44 bad loans have already been approved by the NCLT with loan exposure of Rs 4,842 crore. Additional 55 dud accounts cleared by the Committee of Creditors (CoCs) are awaiting approval of the tribunal. The 55 NPA .

Carlyle's top executives and Advent's leaders in a series of meetings with Yes Bank and SBI's senior management, and RBI officials this week decided the contours of the investment plan

Net interest income rose by just 0.84 per cent in Q1FY22 to Rs 6,147 crore from Rs 6,096 crore a year ago

The banks are expected to start credit operations from April 20, in a bid to help a staggered restart of the economic activities

Even as banks have written off more loans than before, recovery of bad loans has also improved substantially in the past couple of years

The bank had earlier reported NPA provisions of Rs 18,647.23 crore for 2018-19, while the RBI assessment pegged the provisioning at Rs 20,909.23 crore

The bank had earlier reported NPA provisions of Rs 18,647.23 crore for 2018-19, while the RBI assessment pegged the provisioning at Rs 20,909.23 crore

Besides recent corporate slippages, slowdown would impact unsecured retail loans, farm and micro finance loans, commercial real estate and NBFCs and poorly-rated corporates with risk of downgrades

The problem is especially acute for state-owned banks, which are already reeling under the weight of their problem debts

In the previous six months they had risen 5.8%

The RBI has initiated similar action against other public sector banks including IDBI Bank

Sudden spurt in bad loans in Q1 of FY18 brought back fears the worse is not over yet for the banks