Writing off is not waiving loans, defaulters still answerable: FM – The Tribune-OxBig News Network

Finance Minister Nirmala Sitharaman on Tuesday told the Rajya Sabha that writing off a loan did not necessarily mean “waiving off” the loan by the bank.

Answering a starred question asked by Trinamool Congress (TMC) member Ritabrata Banerjee, Sitharaman said defaulters whose loans were written off still faced action initiated through the court and the IBC (Insolvency and Bankruptcy Code, 2016) and so on.

Stating that loan worth about Rs 16 lakh crore had been written off by the banks during last three years, Banerjee asked what action the government had taken against the wilful defaulters. The TMC MP said Rs 12 lakh crore of the Rs 16 lakh crore written off was advanced by public sector banks. The rest was given by private sector banks, he said.

Claiming only about 10 per cent of the loan given by public sector banks could be recovered from defaulters, Banerjee asked the Centre to provide him with the names of top 20 wilful defaulters. He also asked for the details of steps taken by the Centre for “recapitalisation” of the banks affected by the loss.

Sitharaman said the information about “restitution” was being provided in the Parliament periodically when the information was sought for. She added banks wrote-off non-performing assets (NPAs), including, inter alia, those in respect of which full provisioning has been made on completion of four years, as per the Reserve Bank of India (RBI) guidelines and policy approved by banks’ boards.