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As many as 369 big defaulters, with an outstanding of Rs100 crore and more, owe more than Rs1.39 lakh crore to scheduled commercial banks and all India financial institutes (AIFI). Gitanjali Gems Ltd, owned by fugitive businessman Mehul Choksi, remains the top wilful defaulter with an outstanding of Rs8,065 crore as of 31 March 2023, reveals a reply received under the Right to Information (RTI) Act.
IDBI Bank Ltd, which has received multiple bailouts in the past few years, recovered just 7% from big defaulters who have an outstanding of Rs100 crore and more, from Rs45,536 crore bad loans it wrote off since financial year (FY)2016-17. What is more shocking is IDBI Bank took a haircut of 60% while settling loans worth Rs15,623 crore through the national company law tribunal (NCLT), reveals a reply received under the Right to Information (RTI) Act. IDBI Bank was re-categorised as a private sector lender in January 2019 after the Life Insurance Corporation of India (LIC) increased its stake to 51% in the lender.
Maintaining the 'tradition' of public sector banks (PSBs) of keeping hidden the names of big and wilful defaulters, the Central Bank of India (CBI) says information about defaulter-borrowers whose loans worth Rs100 crore and above are written off, is related to third-party and hence cannot be provided. Since FY2016-17, the Bank wrote off bad debts worth Rs21,085 crore of these big defaulters while recovering just 10% or Rs2,031 crore. Interestingly, speaking about haircuts it suffered while recovering bad loans of big defaulters, CBI simply says the query is unclear and hence cannot be replied to!
When it comes to loan recovery from small borrowers, lenders use every resource available, including but not limited to publishing the debtors' names, to hustle them to repay. However, when the bad debt soars to Rs100 crore or more, the same lenders work hard to hide the names and other information of these big defaulters. State-run Bank of Maharashtra (BoM) not only refuses to share the names of big defaulters but also says information about recovery from such loan accounts is 'confidential'.
While public sector banks (PSBs) continue to refuse to share names of big defaulters citing 'confidentiality of customer data', information shared by the Reserve Bank of India (RBI), reveals that just 312 big defaulters owe more than 76% or Rs1,41,583.50 crore of the total bad loans.
State Bank of India (SBI) has again refused to share the names of borrowers who owe Rs100 crore or more, even to its shareholder. Over the past nine years, from FY14 till FY22, SBI has written off bad loans of over Rs145,248 crore of big defaulters while recovering just over 13% from these big defaulters.
The state-run Bank of Maharashtra (BoM) has written off bad loans of over Rs11,204 crore of 42 big defaulters and Rs2,548.13 crore of small borrowers since FY14.
Time and again, public sector banks (PSBs) in India, which are public authorities defined under the Right to Information (RTI) Act, try everything possible to avoid sharing any information,
Time and again, public sector banks (PSBs) in India, which are public authorities defined under the Right to Information (RTI) Act, try everything possible to avoid sharing any information,
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