Nifty99000 100%

Sensex99000 100%

Article rating: 4.2
Article rating: 4.8
Article rating: 4.3
Article rating: No rating
Article rating: No rating
Article rating: No rating
Article rating: No rating
Article rating: No rating
Article rating: No rating
Article rating: No rating
Article rating: No rating
Article rating: No rating
Article rating: 4.0
Article rating: 4.0
Article rating: No rating
Article rating: 3.0


Bad loan situation will improve from next year, banks tell panel

Author: IANS/Wednesday, June 27, 2018/Categories: Banking & Financial Services

Bad loan situation will improve from next year, banks tell panel

New Delhi - Representatives from the 11 public sector banks, which are under RBI scanner for mounting bad loans on Tuesday, assured a parliamentary panel that "things would start looking up from next year" and by 2020, they would be able to come out of the austerity regime imposed by the central bank on them, sources said.

The Parliamentary Committee on Finance headed by senior Congress leader M. Verappa Moily in its meeting held on Tuesday heard out 11 banks -- IDBI Bank, Allahabad Bank, Bank of India, Oriental Bank of Commerce, UCO Bank, Central Bank of India, Indian Overseas Bank, Dena Bank, Bank of Maharashtra, United Bank of India and Corporation Bank.

The Committee is looking into 'Banking Sector in India- Issues, Challenges and the Way Forward, including Non-Performing Assets/Stressed Assets in Banks/Financial Institutions'.

Senior representatives from these banks also answered the queries of the committee.

One of the concerns discussed during the meeting was the "stagnation" in the lending process as these banks "are not able to lend money", resulting in "no income" to them, according to sources.

It also emerged that there was a "lot of fear" among the bankers of institutions like the Comptroller and Auditor General (CAG), Central Bureau of Investigation (CBI), Enforcement Directorate (ED) etc and bank officials are shunning action.

The Reserve Bank of India (RBI) has imposed the Prompt Corrective Action (PCA) framework on banks reeling under bad-debt under which banks face restrictions on distributing dividends and remitting profits. 

Besides, there are restrictions on expanding their branch networks and remuneration of directors.

Since the banks have to comply with the Basel III international norms on capital adequacy and make provision for non-performing assets, it too has constricted lending space.

The total NPAs have touched around nine lakh crore rupees or 10.11% of total advances at December-end 2017. 

The parliamentary panel also desires that RBI Governor Urjit Patel should appear before it "at least twice a year if not more" to brief the Committee on the state of economy, a source said.

Print Rate this article:
No rating

Number of views (213)/Comments (0)

rajyashree guha


Other posts by IANS
Contact author

Leave a comment

Add comment



Ask the Finapolis.

I'm not a robot
Dharmendra Satpathy
Col. Sanjeev Govila (retd)
Hum Fauji Investments
The Finapolis' expert answers your queries on investments, taxation and personal finance. Want advice? Submit your Question above
Want to Invest



The technical studies / analysis discussed here can be at odds with our fundamental views / analysis. The information and views presented in this report are prepared by Karvy Consultants Limited. The information contained herein is based on our analysis and upon sources that we consider reliable. We, however, do not vouch for the accuracy or the completeness thereof. This material is for personal information and we are not responsible for any loss incurred based upon it. The investments discussed or recommended in this report may not be suitable for all investors. Investors must make their own investment decisions based on their specific investment objectives and financial position and using such independent advice, as they believe necessary. While acting upon any information or analysis mentioned in this report, investors may please note that neither Karvy nor Karvy Consultants nor any person connected with any associate companies of Karvy accepts any liability arising from the use of this information and views mentioned in this document. The author, directors and other employees of Karvy and its affiliates may hold long or short positions in the above mentioned companies from time to time. Every employee of Karvy and its associate companies is required to disclose his/her individual stock holdings and details of trades, if any, that they undertake. The team rendering corporate analysis and investment recommendations are restricted in purchasing/selling of shares or other securities till such a time this recommendation has either been displayed or has been forwarded to clients of Karvy. All employees are further restricted to place orders only through Karvy Consultants Ltd. This report is intended for a restricted audience and we are not soliciting any action based on it. Neither the information nor any opinion expressed herein constitutes an offer or an invitation to make an offer, to buy or sell any securities, or any options, futures or other derivatives related to such securities.

Subscribe For Free

Get the e-paper free