Rs 2.30 lakh crore NPAs written off in 5 years

New Delhi: Indian banks have written off NPAs worth whopping Rs 2.30 lakh crore for the five-year period ended March 2016, the finance ministry informed the Lok Sabha on Friday.

Moreover, in the last few years the profit of Indian banks has been coming down due to write-offs and provisioning for bad debts.

“As per the Reserve Bank of India (RBI) data for scheduled commercial banks in 2012-13, the combined net profit was Rs 91,164 crore and the write-off amount was Rs 32,992 crore. In 2016-17, the combined net profit was Rs 43.898 crore, and the write-off amount was Rs 1,08,373 crore,” said the finance ministry in a written reply in the Lok Sabha.

It said that as per data received from public sector banks (PSBs), a total of 2.94 lakh loan accou-nts with aggregate amo-unt of Rs 7,645 crore have been written-off in the financial year 2017-18 till September 2017.

Around  38 loan acco-unts of wilful defaulters, amounting to Rs 516.04 crore, have been written-off in the financial year 2017-18 till  September 2017 by state owned banks, said the ministry.

The finance ministry said writing-off of non-performing assets is a regular exercise conducted by banks to clean up their balance sheet, and achieving taxation efficiency.

However, it said that borrowers of such written off loans continue to be liable for repayment.

The ministry said that the total number of wilful defaulters was 9,063 for the state-owned banks on December 31, 2017,  which represents a marginal increase of 1.66 per cent during the first nine months of the current financial year. The amount involved for PSBs is reported as Rs 1,10,050 crore, it said.

It said that state owned banks have registered 2,108 FIRs against wilful defaulters as on December 31, 2017, filed 8,462 suits for recovery from wilful defaulters, and initiated action under the Securitisation and Reconstruction of Financial Assets and ESIA in respect of 6,962 cases of wilful defaulters.

Quoting RBI, the finance ministry said  country-wise data on ratio of non-performing loans to total gross loans is available on the IMF database. It is observed that the ratio for India compares adversely with those of the US, UK, China and Japan.

“As per the FSR relea-sed by RBI in December 2017, the gross NPAs of Scheduled Commercial Banks increased to 10.2 per cent in September 2017," said the ministry.

As per FSR, macro stress test for credit risk indicates that under the baseline  scenario, the GNPA ratio of the banking sector may increase to 10.8 per cent by March 2018, it added.