Banks write off NPAs worth Rs 516 cr of 38 wilful defaulters
Team Udayavani, Mar 5, 2018, 11:07 AM IST
New Delhi: Public sector banks have written off loans worth Rs 516 crore owed by wilful defaulters in the first half of the current fiscal, as per the data collated by the Finance Ministry.
As part of this exercise, 38 loan accounts of wilful defaulters were written off the books of banks during the April-September period of 2017-18, it said.
Write-off in banking parlance means that the bank has made 100% provision from its earning against that account. Following this, non-performing assets (NPAs) are no longer part of its balance sheet.
However, the write-off puts pressure on the balance sheet of banks, as it erodes operating profit.
Since recovery in case of wilful default is very remote, the possibility of write-back in the future is also very little, said a senior bank official.
A wilful defaulter is somebody who has essentially not used the fund for the purpose it has been borrowed or he has not repaid when he can do so; he has siphoned off the funds or he disposed of the assets pledged for loan without the bank’s knowledge.
If there is wilful default then where is the possibility of recovery, when the entire exercise was undertaken with a clear intention of default, the official said, adding that banks could only get few of their assets which have been disclosed.
The country’s largest lender SBI accounts for over 27 per cent of the total amount owed to public sector banks by wilful defaulters as of March 2017, according to ministry data.
Udayavani is now on Telegram. Click here to join our channel and stay updated with the latest news.
Top News
Related Articles More
Sensex, Nifty fall for 2nd day on FII selling; RIL, ICICI Bank major drag
Sensex, Nifty fall over 1 pc, snap two-day rally ahead of US Fed interest rate decision
SC orders liquidation of grounded air carrier Jet Airways’ assets
Home-cooked meals become dearer in October on costlier vegetables
Sensex, Nifty surge over 1 pc on heavy buying in IT stocks as Trump set to win US polls
MUST WATCH
Latest Additions
No greater feeling than serving those in need: Outgoing CJI D Y Chandrachud
Baikampady: Here, even elederly have to crawl under trains to cross tracks!
CJI Chandrachud: A legacy of landmark verdicts that shaped society and some controversy too
Neeraj Chopra to head to South Africa for off-season training later this month
Sensex, Nifty fall for 2nd day on FII selling; RIL, ICICI Bank major drag
Thanks for visiting Udayavani
You seem to have an Ad Blocker on.
To continue reading, please turn it off or whitelist Udayavani.