New Delhi: Bad loans of the state-owned banks are likely to go up further to 10.1% by the end of the current fiscal, minister of state for finance Santosh Kumar Gangwar said, quoting a report by the Reserve Bank of India (RBI).
In a written reply to the Rajya Sabha, the minister said the RBI’s financial stability report had said that “under the baseline scenario, the GNPA (gross non-performing assets) ratio for public sector banks may go up to 10.1 per cent by March 2017".
He attributed the rise in bad loans to a host of factors such as domestic growth sluggishness in the recent past, slowdown in recovery in global economy and continuing uncertainty in global markets, leading to lower exports of various products like textiles, engineering goods, leather and gems.
The other factors responsible for the rise in NPAs include ban on mining projects, delay in clearances affecting power, iron and steel sector, volatility in prices of raw material, shortage in availability of power and also aggressive lending by banks in the past.
GNPA jumped from 5.43% ( ₹ 2.67 trillion) in 2014-15 to 9.32% ( ₹ 4.76 trillion) in 2015-16, Gangwar said in a reply to another question.
The minister further said there were 701 NPA accounts above ₹ 100 crore amounting to ₹ 1.64 trillion in public sector banks as on December 2015. The RBI, he added, has also submitted a list of defaulters of above ₹ 500 crore to the Supreme Court in a sealed cover.
The minister, in yet another reply, said there were 8,167 wilful defaulters with NPAs of ₹ 25 lakh and above. They collectively owed ₹ 76,685 crore to the banks. The banks, he said, filed first information reports in 1,724 cases and recovered ₹ 3,498 crore from 1,650 such defaulters in 2015-16.
The minister said both the government and the RBI have taken a number of measures to deal with the problem of mounting bad loans. These include addressing the issues in sectors such as power, steel and textiles; establishment of debt recovery tribunals, formation of joint lenders’ forum and introduction of the strategic debt restructuring scheme.