At a time when capital is scarce, a clutch of 10 banks has written off loans worth Rs 1 lakh crore in 2017-18. That\u2019s 50% higher than the write-offs that these banks took in the previous financial year, data compiled by FE show. State Bank of India (SBI), which refers to write-offs as advance under collection account (AUCA), wrote off Rs 40,196 crore in 2017-18 as against Rs 20,570 crore in 2016-17. While it is possible banks may recover some of this money, the write-offs are expected to be sizeable in the current year too. The hits will come following the insolvency proceedings initiated for a dozen large companies to which lenders have a total exposure of Rs 2.4 lakh crore. While banks have made provisions for these assets, in keeping with the Reserve Bank of India\u2019s rules, they may need to written off some of the loan amount. Most of these near-bankrupt companies have found buyers under the Insolvency and Bankruptcy Code (IBC) but the sales would necessitate banks taking haircuts anywhere in the range between 30% and 70%. In the case of Bhushan Steel the haircut has been just about 33% of the admitted claims of Rs 56,000 crore and should UltraTech Cement wins Binani Cement, bankers would get back almost 90% of their dues. However in the case of Electrosteel Steels, bagged by Vedanta, the hit to banks is a much bigger 60%. Meanwhile, bids for Essar Steel, which owes lenders Rs 49,000 crore, are understood to have come in at around 38,000 crore. The big loss for banks could come in from the exposure of Rs 45,300 crore to Lanco Infratech, which appears to be headed for liquidation. Again, the best bid for Alok Industries, which owes banks nearly Rs 30,000 crore, is believed to be only Rs 5,000 crore. There is a another lot of more than two dozen companies against which lenders may initiate insolvency proceedings; the total exposure that banks have to these companies is Rs 1.2 lakh crore. The government announced in October 2017 that it would recapitalise state-owned banks to the tune of Rs 2.11 lakh crore over the next two years. Of this, Rs 80,000 crore worth of bonds have already been issued. Lenders write off toxic assets once it becomes extremely difficult to recover them. However, these loans are fully provided for and banks are able to recover a part of their dues. Once recovered, the provisions held for these accounts are reversed. These recoveries are clubbed under other income in a bank's profit and loss statement. For instance, SBI recovered Rs 5,333 crore from such accounts in FY18, up 35%. Another large public sector lender, Bank of India, could recover Rs 407 crore in FY18 from written-off accounts. In February 2016, the Reserve Bank of India (RBI) had said that writing off non-performing assets is a regular exercise conducted by banks to clean up their balance sheets. \u201cSubstantial portion of this write-off is, however, technical in nature. It is primarily intended at cleansing the balance sheet and achieving taxation efficiency,\u201d the central bank had said According to the central bank, in \u2018technically written off\u2019 accounts, loans are written off from the books at the head office, without forgoing the right to recovery. Citing a reply in the Rajya Sabha, news agencies reported in April, public sector banks wrote off Rs 2.42 lakh crore worth of loans between April 2014 and September 2017.