NEW DELHI: Finance ministry has instructed the managing directors of public sector banks to conduct monthly reviews of top 20 insolvency cases. Finance minister Nirmala Sitharaman will review the operations of the National Asset Reconstruction Company Ltd (NARCL) soon to address delays in acquiring non-performing loans.
To address these issues, a meeting was held by the Department of Financial Services (DFS) with public sector banks (PSBs) and NARCL management on Friday. “Top 20 insolvency cases must be reviewed monthly by managing directors of PSBs as there have been delays in admission of such cases…Finance minister to review the functioning of NARCL soon,” Joshi told reporters after the meeting.
NARCL was established to take over and dispose of stressed assets from commercial banks, aiming to clean up their books and unlock more funds for economic growth. NARCL, set up in July 2021, serves as a “bad bank” to address the rising issue of NPAs.
As per information provided in the Rajya Sabha, by November, 10 PSBs had transferred bad loans amounting to Rs 11,617 crore to NARCL. Among them, State Bank of India (SBI) had the highest debt transferred, Rs 4,508 crore. Punjab National Bank followed with Rs 2,138 crore, while Canara Bank and Union Bank transferred Rs 1,858 crore and Rs 1,831 crore, respectively. Additionally, several other PSBs have also transferred their NPAs to NARCL.