Public sector banks recovered Rs 1.03 lakh crore written-off loans in last five years

Public sector banks have recovered Rs 1,03,045 crore of written-off loans in the past five years, the government informed the parliament recently.

Minister of state in Ministry of finance Dr Bhagwat Karad in responding to a query in the upper house of the parliament said that recovery in NPA accounts including written-off loans, is an on-going process, and public sector banks have recovered Rs 1,03,045 crore in written-off loans during the last five financial years.

He informed the parliament that banks continue to pursue recovery actions initiated in written-off accounts through various recovery mechanisms available, such as filing of a suit in civil courts or in Debts Recovery Tribunals, action under the Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002, filing of cases in the National Company Law Tribunal under the Insolvency and Bankruptcy Code, 2016, through negotiated settlement/compromise, and through sale of non-performing assets.

As per Reserve Bank of India (RBI) guidelines and policy approved by banks’ Boards, 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. Banks evaluate/consider the impact of written-off loans as part of their regular exercise to clean up their balance-sheet, avail of tax benefit and optimise capital, in accordance with RBI guidelines and policy approved by their Boards.

Meanwhile, the government said that total amount of loan written off in the last five years has crossed Rs 10 lakh crore. State Bank of India accounted for Rs 204,486 crore of the written off loans followed by PNB (Rs 67,214 crore), Bank of Baroda (Rs 66,711 crore) and ICICI Bank (Rs 50,514 crore)

Bank-wise details of NPAs written-off by scheduled commercial banks (SCBs) during 2017 to 2022:

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