1. Wilful defaulters owe public sector banks Rs 66,190 crore, says Jayant Sinha

Wilful defaulters owe public sector banks Rs 66,190 crore, says Jayant Sinha

Wilful defaulters owed the country’s public sector banks (PSBs) a staggering R66,190 crore at the end of 2015, up 138% from the level three years ago, minister of state for finance Jayant Sinha told Parliament on Tuesday.

By: | New Delhi | Published: May 4, 2016 5:56 AM
While advocating strong action against wilful defaulters, RBI governor Raghuram Rajan had earlier said that it would be wrong to assume mala fide in all cases where loans turn into bad debts.(PTI) While advocating strong action against wilful defaulters, RBI governor Raghuram Rajan had earlier said that it would be wrong to assume mala fide in all cases where loans turn into bad debts.(PTI)

Wilful defaulters owed the country’s public sector banks (PSBs) a staggering R66,190 crore at the end of 2015, up 138% from the level three years ago, minister of state for finance Jayant Sinha told Parliament on Tuesday.

The outstanding amount rose the steepest (5,363%) in the case of Punjab National Bank (PNB) which in December 2015 needed to recover R10,870 crore from such borrowers. PNB listed Winsome Diamonds & Jewellery, Zoom Developers and the defunct Kingfisher Airlines and its guarantors United Breweries Holdings and United Spirits chairman Vijay Mallya among its wilful defaulters.

“The total exposure of top 50 defaulters of PSBs as on December 2015 was Rs 1,21,832 crore,” Sinha said in a written reply in the Rajya Sabha. In another reply, he said there were 1,365 borrower accounts having funded outstanding loans of Rs 500 crore and above at the end of 2015. He further said that the government has taken specific measures to address issues in sectors such as infrastructure, steel and textiles, where the incidence of non-performing assets (NPAs) is high.

While advocating strong action against wilful defaulters, Reserve Bank of India governor Raghuram Rajan had earlier said that it would be wrong to assume mala fide in all cases where loans turn into bad debts.

State Bank of India (SBI) retains the top slot among PSBs with exposure to wilful defaulters: Its exposure rose 60% to Rs 11,705 crore in the three years to December 2015. Other PSBs with high exposure to wilful defaulters are: Central Bank of India (Rs 4,408 crore ), UCO Bank (Rs 4,251 crore) and Oriental Bank of Commerce (Rs 3,834 crore).

According to a recent report from rating agency Crisil, significant stress in the corporate loan book of PSBs is expected to result in their weak assets ballooning to Rs 7.1 lakh crore by March 31, 2017 (11.3% of total loan book) from around Rs 4 lakh crore as on March 31, 2015 (7.2% of loan book).

The issue of wilful defaulters has hogged the limelight after a surge in NPAs in October-December 2015 due to the recognition of certain stressed accounts by banks as per RBI norms. With the case of the erstwhile Kingfisher Airlines and its wilful defaulter promoter Mallya in focus, PSBs have accelerated recovery actions by filing FIRs, suits in courts and steps under the Sarfaesi Act to recover loans.

According to the government, while the number of wilful defaulters increased 38% to 7,686 by the end of 2015, suits were filed in 6,816 cases involving Rs 58,500 crore and FIRs in 1,669 cases involving Rs 18,212 crore. Also, action under the Sarfaesi Act was taken in 5,840 cases involving Rs 53,407 crore.

p1g3 p1gwil

Get latest news and updates on Auto Expo 2018, check breaking news on Budget 2018, like us on Facebook and follow us on Twitter.

  1. C
    Chandra Shekhar A K
    May 4, 2016 at 3:35 am
    It is high time Govt privatises all nationalised and govt banks to free them from political inter- ference and corruption-prone management emboldened further by ineffective supervision by RBI with high-paid officials. Before doing that however all the NPAs should be independently investigated by a team of auditors and experts to identify the causes and culprits behind the NPAs and punish the guilty, attach the properties of scamsters involved if any and recover maximum possible dues. Govt should stop pumping taxpayers' money any further into these banks to help them write off these NPAs letting the guilty bank officials go scot free
    Reply
    1. P
      P.K.GHOSH
      May 4, 2016 at 4:06 am
      People are interested to know what action is taken by govt. to make defaulters pay back the money or to take stern action to cease the all property (movable or immovable) so that public money be available in economic & financial system.corruption in all spheres have made a great development during last five years, Present Govt. is not taking any corrective & preventive action towards this. what is happening is acceptable to our govt. Modi JI IS FAILED to curbe the corruption,
      Reply
      1. S
        Srinivas
        May 4, 2016 at 4:01 am
        While media is obsessed with Mallya, Interesting to know where the other 85% of the money is, who the bank officials involved who disbursed the money are?
        Reply

        Go to Top