Lok Sabha Question No. 387 (UNSTARRED), answered on 2019-06-24
Subject: Bank NPA
Ministry: FINANCE
Asked by: Sushil Kumar Singh, Gopal Chinayya Shetty, Adoor Prakash

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

## LOK SABHA

## UNSTARRED QUESTION NO: 387 TO BE ANSWERED ON THE 24 th  JUNE, 2019/ASHADHA 3, 1941  (SAKA)

## QUESTION Bank NPA

## 387: SHRI SUSHIL KUMAR  SINGH:  SHRI GOPAL  CHINNAYA  SHETTY: ADV.  ADOOR  PRAKASH:

Will  the Minister  of FINANCE  be pleased to state:

- (a) whether any survey or study has been  conducted or commissioned   by the Government   on  Non-Performing   Assets  (NPAs)   in  the  various   banks   and  other financial institutions of the country including the share  of leading  corporate houses/companies  therein;
- (c) whether   according   to  the  Reserve   Bank of  India,   the  gross  NPAs   in  public   sector banks are valued  at around  Rs. 4 lakh  crore  which  represents  90 per cent of the total NPAs of banks  in India;  and
- (b) if so, the details  thereof,  bank-wise;
- (d) if so, the details  thereof  and the corrective  steps being taken  by  the Government  to recover  and reduce  NPAs  in the country  particularly in the State of Bihar?

## ANSWER

## (SMT. NIRMALA  SITHARAMAN )

## To be answered by FINANCE  MINISTER

(a) to (d): As per Reserve  Bank of India (RBI) data on global  operations,  aggregate  gross advances  of  Public   Sector   Banks  (PSBs)  increased   from   Rs.  18,19,074   crore   as  on 31.3.2008  to Rs. 52,15,920  crore  as on 31.3.2014.  As per RBI inputs,  the primary  reasons for  spurt   in  stressed  assets  have  been  observed   to  be, inter-alia, aggressive   lending practices,   wilful   default   /  loan  frauds  /  corruption   in  some  cases,  and  economic slowdown.  Asset Quality  Review  (AQR)  initiated  in 2015 for clean and fully  provisioned bank  balance-sheets   revealed   high   incidence   of  NPAs.   As  a  result  of  AQR   and subsequent  transparent  recognition  by  banks,  stressed accounts  were  reclassified  as NPAs and expected losses on stressed loans,  not provided  for earlier  under flexibility given to restructured  loans,  were  provided  for. Further,  all such schemes for restructuring stressed loans were  withdrawn. Primarily as a result of transparent  recognition  of stressed assets as  NPAs,   gross  NPAs   of  PSBs,  as  per  RBI  data  on  global   operations,   rose  from Rs. 2,79,016 crore  as on 31.3.2015,  to Rs. 8,95,601 crore  as on 31.3.2018,  and as a result of  Government's   4R's  strategy   of  recognition, resolution,   recapitalisation and  reforms, have since declined  by  Rs. 89,189 crore  to Rs. 8,06,412  crore  as on 31.3.2019  (provisional data).

Data on NPAs is regularly  published  by  RBI as part  of its Financial   Stability Reports. NPA data is not collated  by  RBI in terms  of corporate  houses / companies.    PSB-wise details  of gross NPA  (GNPA)  for Industry  category  advances in domestic  operations  and total  GNPA  in global  operations,  as per RBI data,  are at Annex.

Over the  last  four  years,   Government   has  taken   comprehensive   steps  under its  4R's strategy  of recognising  NPAs  transparently, resolving  and recovering  value  from  stressed accounts,  recapitalising PSBs, and reforms  in banks  and financial  ecosystem  to ensure  a responsible  and clean  system.

As per RBI provisional  data on global  operations,  as on 31.3.2019,  the aggregate  amount of  gross  NPAs   of  PSBs  and  Scheduled   Commercial Banks  (SCBs)  were   Rs.  8,06,412 crore  and Rs. 9,49,279 crore  respectively.

Steps taken   to  expedite   and  enable   resolution   of  NPAs   of  PSBs,  include, inter-alia ,  the following:

- (2) Securitisation and  Reconstruction   of Financial   Assets  and  Enforcement   of Security  Interest  Act  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.
- (1) The Insolvency  and Bankruptcy  Code,  2016 (IBC) has been enacted,  which  has provided  for the taking  over management  of the affairs of the corporate  debtor  at the outset of the corporate insolvency resolution process. Coupled with debarment  of wilful  defaulters  and persons associated  with  NPA  accounts  from the  resolution   process,   this   has  effected  a  fundamental   change   in  the  creditordebtor  relationship. Further,  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   under the aforesaid   amended   provision   in  the  Banking   Regulation   Act,   1949,  banks   have been filed cases under  IBC before the National  Company  Law  Tribunal  in respect of RBI-specified borrowers.
- (3) Under  the PSB Reforms  Agenda,  PSBs have created  Stressed Asset Management Verticals  to focus attention  on recovery,  segregated  monitoring from sanctioning roles  in  high-value   loans,   and  entrusted   monitoring of  loan   accounts   of  above Rs. 250 crore to specialised monitoring agencies for clean and effective monitoring,   and  created   online   end-to-end  One-Time   Settlement   platforms   for timely  and better  realisation.

Enabled by the above steps, as per RBI data on global  operations  (provisional  data for the financial  year  ending  March  2019), gross NPAs  of PSBs have declined  from the peak of  Rs.  8,95,601   crore   in  March 2018 to  Rs.  8,06,412 crore   in  March 2019 (provisional data).  PSBs have recovered  Rs. 3,59,496 crore  over the last four financial  years,  including record  recovery  of Rs. 1,23,156 crore  during  2018-19.

Note: Figures cited above for PSBs include those for IDBI Bank Limited, which was recategorised as a private sector bank by RBI with effect from 21.1.2019.

## Lok Sabha Unstarred  Parliament  Question  No. 387,  for  24.6.2019 Gross NPA (GNPA) for Industry  category advances in domestic operations and total GNPA in global operations of Public Sector Banks

| Bank               | GNPA* for Industry category (as on 31.3.2019)   | Total GNPA* (as on 31.3.2019)   | * Asset Quality Review (AQR) initiated in 2015 for clean and fully provisioned bank balance- sheets revealed high incidence of Non-Performing Assets (NPAs). As a result of AQR and subsequent transparent recognition by PSBs, stressed accounts were reclassified as NPAs and expected losses on stressed loans, not provided for earlier under flexibilitygiven to restructuredloans, were provided for. All such schemes for restructuringstressed loans were withdrawn. Primarily as a resultof transparent recognition of stressed assets as NPAs,the gross NPAs of Public Sector Banks (PSBs) increased. Enabled by Government's 4R's strategy,as per RBI dataon global operations, PSBs have recovered Rs. 3.59 lakh crore over the last four financial years, including record recovery of Rs. 1.23 lakh crore during 2018-19, and Provision coverage ratio has increased from 46% in March 2015 to74.2% inMarch 2019.   |
|--------------------|-------------------------------------------------|---------------------------------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| AllahabadBank      | 20,413                                          | 28,578                          |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   |
| AndhraBank         | 24,295                                          | 28,380                          |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   |
| Bank ofBaroda      | 27,374                                          | 53,383                          |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   |
| Bank ofIndia       | 29,164                                          | 59,117                          |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   |
| Bank ofMaharashtra | 7,692                                           | 15,324                          |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   |

| CanaraBank          | 23,800   | 38,003   |                |
|---------------------|----------|----------|----------------|
| CentralBankof India | 21,493   | 33,567   |                |
| Corporation Bank    | 13,615   | 23,630   |                |
| DenaBank            | 8,008    | 12,242   |                |
| IndianBank          | 9,980    | 13,437   |                |
| IndianOverseasBank  | 23,353   | 35,139   |                |
| Commerce            | 13,762   | 23,952   | OrientalBankof |
| Punjaband SindBank  | 4,145    | 8,046    |                |
| PunjabNationalBank  | 45,695   | 78,031   |                |
| SyndicateBank       | 8,929    | 24,675   |                |
| UCOBank             | 20,697   | 29,888   |                |
| UnionBankof India   | 27,321   | 49,995   |                |
| UnitedBank ofIndia  | 9,087    | 11,673   |                |
| VijayaBank          | 5,225    | 8,088    |                |
| StateBank ofIndia   | 1,28,921 | 1,76,342 |                |

Source: RBI