Punjab National Bank is drawing up a list of defaulters it plans to refer to the National Company Law Tribunal (NCLT), in addition to the list it has received from the Reserve Bank of India, to expedite its bad loan recovery process, a senior official with direct knowledge of the development said. “We have nearly finished making this list and it should be ready in the next two to three days. We do not want to depend only on what the RBI has sent,” the official who is not authorised to speak to the media, said on the condition of anonymity. The list will include borrowers with outstanding between Rs 500 crore and Rs 5,000 crore, the official said. In August, the Delhi-based public sector lender said it had exposure to 13 accounts amounting to Rs 350 crore that had been referred to the NCLT.
“Our focus is on recovery and we believe the NCLT route brings in some amount of transparency to the process. We will make as much use of this route as possible,” the official said. Punjab National Bank has already initiated discussion with other lenders regarding the RBI’s second list, he added. Earlier this week, the RBI had sent the lenders a second list of stressed assets including Videocon, Visa Steel and Jaiswal Neco, that the banks need to refer to the NCLT by December 31. In June, the central bank had identified 12 large accounts that made up 25% of the total gross non-performing assets of the Indian banking sector for being referred to the NCLT. Eleven of these 12 cases have been identified and insolvency proceedings have been initiated.
Punjab National Bank has exposure to nine of these accounts. With fresh slippages of 6.3% (annualised) in April-June as against 6.2% (annualised) in January-March, asset-quality pain for Indian banks continues, ratings agency Icra said in a recent report. The overall gross NPAs for 41 listed banks increased to Rs 8.28 lakh crore (10.4%) as on June 30, 2017, from Rs 7.65 lakh crore (9.5%) as on March 31, 2017. Icra estimates that gross NPAs are likely to increase to Rs 8.8-9.0 lakh crore (9.9-10.2%) by March 31, 2018.
At the end of the June-quarter, Punjab National Bank’s gross non-performing assets ratio was 13.66%, compared with 13.75% in the year-ago period and 12.53% at the end of the March quarter, while the net non-performing asset ratio stood at 8.67%, 9.16% and 7.81%, respectively. Fresh slippages at the end of the quarter stood at Rs 6,018 crore, lower than Rs 7,533 crore last year and Rs 20,252 crore at the end of March.
– Shamik Paul