Lok Sabha Question No. 1132 (UNSTARRED), answered on 2017-07-21
Subject: Insolvency and Bankruptcy Proceedings
Ministry: FINANCE
Asked by: GAJANAN CHANDRAKANT KIRTIKAR, ASHOK SHANKARRAO CHAVAN, P. C. MOHAN, SUPRIYA SADANAND SULE, RAJEEV SHANKARRAO SATAV, BIDYUT BARAN MAHATO, T. RADHAKRISHNAN, VIJAY KUMAR S.R., HARI BABU KAMBHAMPATI, B.N. CHANDRAPPA, JAYAKUMAR JAYAVARDHAN, SUDHEER GUPTA, P.R. SUNDARAM, KUNWAR HARIBANSH SINGH, C. N. JAYADEVAN, VIJAYSINH MOHITE PATIL, HEENA VIJAYKUMAR GAVIT, DODDAALAHALLI KEMPEGOWDA SURESH

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

LOK SABHA UNSTARRED QUESTION NO: 1132

TO BE ANSWERED ON THE 21 st  JULY, 2017/ASHADHA 30, 1939 (SAKA)

## QUESTION

## INSOLVENCY AND BANKRUPTCY PROCEEDINGS

1132:   SHRI GAJANAN KIRTIKAR: SHRI ASHOK SHANKARRAO CHAVAN: SHRI P.C. MOHAN: SHRIMATI SUPRIYA SULE: SHRI SATAV RAJEEV: SHRI BIDYUT BARAN MAHATO: SHRI T. RADHAKRISHNAN: SHRI S.R. VIJAYAKUMAR: DR. KAMBHAMPATI HARIBABU: SHRI B.N.  CHANDRAPPA:  DR.  J.  JAYAVARDHAN:  SHRI  SUDHEER  GUPTA:  SHRI  P.R. SUNDARAM:  KUNWAR  HARIBANSH  SINGH:  SHRI  C.N.  JAYADEVAN:  SHRI  MOHITE PATIL  VIJAYSINH  SHANKARRAO:  DR.  HEENA  VIJAYKUMAR  GAVIT  AND  SHRI  D.K. SURESH:

Will the Minister of FINANCE be pleased to state:

- a) whether the Reserve Bank of India (RBI) has identified 12 large loan defaulters who account for 25 per cent of the total NPAs in the banking sector;
- b) if so, the details of the defaulters along with the amount of NPAs;
- c) whether the RBI has ordered banks to initiate insolvency and bankruptcy proceedings against these defaulters;
- d) if so, whether the banks had conducted meeting of lenders to finalise resolution of loans; and
- e) if so, the details thereof and the outcome thereto along with the steps taken/being taken by the Government to fast track bankruptcy proceedings under the insolvency and bankruptcy code (IBC)?

## ANSWER

## To be answered by

## THE MINISTER OF STATE IN THE MINISTRY OF FINANCE (SHRI SANTOSH KUMAR GANGWAR)

(a) to (e): Reserve Bank of India (RBI) has constituted an Internal Advisory Committee (IAC), which arrived at an objective, non-discretionary criterion for referring accounts for resolution under IBC. In particular,  the  IAC  recommended  for  IBC  reference  all  accounts  with  fund  and  non-fund  based outstanding amount greater than Rs.5000 crore, with 60% or more classified as non-performing by banks as of March 31, 2016.

Accordingly,  Reserve  Bank  of  India  has  issued  directions  to  certain  banks  for  referring  12 accounts, qualifying under the aforesaid criteria, to initiate insolvency process under the Insolvency and Bankruptcy Code, 2016.   As regards the other non-performing accounts which do not qualify under the above criteria, the IAC recommended that banks should finalize a resolution plan within six months. In cases where a viable resolution plan is not agreed upon within six months, banks should be required to file for insolvency proceedings under the IBC.

However, the names and details of borrowers are not disclosed as prescribed under section 45E of the Reserve Bank of India (RBI) Act, 1934 and Banking Laws, which provide for the obligation of a bank or financial institution to maintain secrecy about the affairs of its constituents.

**********