Lok Sabha Question No. 2882 (UNSTARRED), answered on 2018-08-03
Subject: NPAs and Bad Loans
Ministry: FINANCE
Asked by: V. SATHYABAMA, VEENA DEVI, M. CHANDRAKASI

## GOVERNMENT  OF INDIA MINISTRY OF  FINANCE DEPARTMENT  OF FINANCIAL SERVICES

LOK SABHA UNSTARRED  QUESTION  NO: 2882 TO BE ANSWERED  ON THE 3 rd  AUGUST,  2018/SHRAVANA 12, 1940 (SAKA)

## QUESTION NPAs AND BAD LOANS

2882:  SHRIMATI V. SATHYA  BAMA: SHRIMATI VEENA  DEVI: SHRI M. CHANDRAKASI:

Will  the Minister  of FINANCE  be pleased to state:

- a) the percentage  of banks  affected by  Non-Performing  Assets (NPAs)  along  with  the number  of private  and Public  Sector  Banks (PSBs) having  NPAs/bad  loans as on date public  sector  and private  sector  banks,  bank-wise;
- b) whether  NPAs  in these banks  have increased  sharply  during  the last three  years,  if so, the details  thereof;  and
- c) the amount  of NPAs/bad  loans targeted  to be recovered  by  these banks  in the year 2018-19 along  with  the action  taken  in this  regard?

## ANSWER

(a) and (b): The gross advances of Scheduled  Commercial Banks (SCBs) increased  from Rs. 25,03,431  crore  as on 31.3.2008  to Rs. 68,75,748  crore  as on 31.3.2014, as per the global   operations   data  of  the  Reserve   Bank of  India  (RBI).  As  per  RBI  inputs,   the primary  reasons for spurt  in stressed assets have been observed  to be, inter-alia, due to aggressive  lending  practices,  wilful  default  / loan  frauds / corruption  in some cases, and economic   slowdown.   Asset  Quality   Review   (AQR)   carried   out  in  2015 for  clean   and fully  provisioned  bank  balance-sheets  revealed  high  incidence  of Non-Performing Assets (NPAs).   Expected  losses  on  stressed  loans,   not  provided   for  earlier   under flexibility given to restructured  loans,  were  reclassified  as NPAs  and provided  for expected  losses. During   financial   year   (FY)  2017-18,  all  such  schemes  for  restructuring stressed  loans were withdrawn. The aggregate  gross NPAs  of SCBs increased  primarily as  a  result of this transparent  recognition  of stressed assets as NPAs,  from Rs. 3,23,464 crore,  as on 31.3.2015,  to Rs. 10,35,528  crore,  as on 31.3.2018  (provisional  data),  as per RBI data on global   operations.   Bank-wise   details   of  gross  NPAs   of  global   operations   of  all   public sector and private  sector banks,  as on 31.3.2018  (provisional  data),  furnished  by  RBI, are at Annexure.

## To be answered by THE MINISTER OF  STATE  IN THE  MINISTRY OF  FINANCE (SHRI SHIV PRATAP  SHUKLA)

(c): With  regard  to the amount  of NPA  / bad loans targeted  to be recovered  by  banks  in the year  2018-19, RBI has informed  that  it does not have the required  information. As regards  action  taken  with  regard to recovery  of NPAs,  a number  of measures  have been taken  to expedite  and enable  resolution  of NPAs  of Public  Sector  Banks (PSBs). The Insolvency  and Bankruptcy  Code,  2016 (IBC) has been enacted  to create a unified framework  for resolving  insolvency  and bankruptcy matters.  Under  this,  by  adopting  a creditor-in-saddle approach, with the interim resolution professional taking over management  of affairs of corporate  debtor  at the outset,  the incentive  to resort  to abuse of  the  legal   system has  been  taken   away.   This,   coupled   with   debarment   of  wilful defaulters  and persons associated  with  NPA  accounts  from the resolution  process, has effected a fundamental change  in the creditor-debtor relationship. The  Banking Regulation   Act,   1949 has  been  amended   to  provide   for  authorisation to  RBI  to  issue directions  to banks  to initiate  the insolvency  resolution  process under  IBC. As per RBI's directions,  cases have been filed under  IBC before the National  Company  Law  Tribunal in  respect  of  39  large   defaulters,   amounting   to  about   Rs.  2.69  lakh   crore   funded exposure (as of  December  2017).

In  addition,   under  the  PSBs  Reforms   Agenda,   PSBs  have  created   Stressed  Asset Management  verticals  for stringent  recovery,  segregated  pre- and post-sanction  followup  roles  for  clean  and  effective   monitoring, initiated   creation   of  online   one-time settlement  platforms  and committed  to monitoring  large-value  accounts  by  tying  up with Agencies  for Specialised  Monitoring for loans of Rs. 250 crore  and above.

The Securitisation  and Reconstruction of Financial  Assets and Enforcement  of Security Interest Act,  2002 has been amended  to make it more  effective with  provision  for three months  imprisonment  in case the borrower  does not provide  asset details  and for the lender   to  get  possession  of  mortgaged   property   within   30  days.   Also, six  new   Debts Recovery  Tribunals  have been established  to expedite  recovery.

***

Lok Sabha Unstarred  Question  no. 2882,  for  3.8.2018

Annexure

## Details of gross NPAs of global operations  of Scheduled Commercial Banks, as on 31.3.2018

Bank

Gross

- [ ] Bank

Gross

Amounts  in crore  Rupees

|                                  | NPAs          |
|----------------------------------|---------------|
| Allahabad Bank                   | 26,563        |
| Andhra Bank                      | 28,124        |
| AxisBank Limited                 | 30,876        |
| Bandhan Bank Limited             | 373           |
| Bank of Baroda                   | 56,480        |
| Bank of India                    | 62,328        |
| Bank of Maharashtra              | 18,433        |
| Canara Bank                      | 47,468        |
| Catholic SyrianBank Ltd. Central | 764 38,131    |
| Bank of India CityUnion Bank     |               |
| Limited                          | 857           |
| Corporation Bank                 | 22,213        |
| DCBBank Limited                  | 369           |
| DenaBank                         | 16,361        |
| Federal Bank Ltd. HDFC           | 2,796         |
| Bank Ltd.                        | 8,507         |
| ICICIBank Limited                | 53,240        |
| IDBI Bank Limited                | 55,588        |
| IDFCBank Limited                 | 1,779         |
| IndianBank Indian Overseas       | 11,990 38,180 |

|                               | NPAs     |
|-------------------------------|----------|
| NainitalBank Ltd.             | 167      |
| OrientalBank of Commerce      | 26,134   |
| Punjaband SindBank            | 7,802    |
| Punjab NationalBank           | 86,620   |
| RBL Bank Limited              | 567      |
| SouthIndian Bank Ltd.         | 1,980    |
| StateBank of India            | 2,23,427 |
| Syndicate Bank                | 25,759   |
| Tamilnad Mercantile Bank Ltd. | 868      |
| The Dhanalakshmi Bank Ltd.    | 469      |
| UCOBank                       | 30,550   |
| UnionBank of India            | 49,370   |
| UnitedBank of India           | 16,552   |
| VijayaBank                    | 7,526    |
| Yes Bank Ltd.                 | 2,627    |

| Bank                     |       |
|--------------------------|-------|
| IndusInd Bank Ltd.       | 1,705 |
| Jammu& Kashmir Bank Ltd. | 6,007 |
| Karnataka Bank Ltd.      | 2,376 |
| KarurVysya Bank Ltd.     | 3,016 |
| Kotak Mahindra Bank Ltd. | 3,825 |
| Lakshmi VilasBank Ltd.   | 2,694 |

Source: RBI, global operations (Mar-2018 provisional data) ***