NEW DELHI: In the last four years, banks have written off Rs 8.5 lakh crore, as per the data released by the finance ministry on Monday. India’s largest lender the State Bank of India (SBI) wrote off Rs 1.65 lakh crore, followed by Punjab National Bank (PNB) at Rs 59,807 crore in this period.
Data show SBI wrote off Rs 19,666 crore in loans in FY22, Rs 34,402 crore in FY21, Rs 52,362 crore in FY20 and Rs 58,905 crore in FY19. IDBI Bank wrote off total Rs 33,135 crore during the last four years, with writing off Rs 2,889 crore in FY 22. Among private sector banks, ICICI Bank wrote off Rs 42,164 crore and HDFC Bank wrote off Rs 31,516 crore loans.
Responding to a query in Lok Sabha, finance minister Nirmala Sitharaman said according to the Reserve Bank of India (RBI) guidelines and policy approved by banks’ Boards, NPAs or non-performing assets, including inter-alia those in respect of which full provisioning has been made on completion of four years are removed from the balance sheet of the bank concerned by way of a write-off.
Banks evaluate the impact of write-offs as part of their regular exercise to clean up their balance sheet, avail of tax benefits and optimise capital, in accordance with RBI guidelines and policy approved by their Boards.“The borrowers of written-off loans continue to be liable for repayment and the process of recovery of dues from the borrower in written-off loan accounts continues. Banks continue to pursue recovery actions initiated in written-off accounts through various recovery mechanisms available,” the FM said.
Write-offs done 4-yr after provisioning
FM Nirmala Sitharaman said as per the RBI guidelines and policy approved by banks’ Boards, NPAs including inter-alia those in respect of which full provisioning has been made on completion of four years are removed from the balance sheet of the bank concerned by way of write-off
