Press Information Bureau

Government of India

Ministry of Finance

29-November-2012 14:41 IST

The details of Bank Group-wise ratio of Gross Non-Performing Assets (GNPAs) to Gross Advances as on 31st March, 2012 and as on 30th September, 2012 are as under: 

*provisional

To improve the health of financial sector, to reduce the NPAs, to improve asset quality of banks and to prevent slippages, Reserve Bank of India (RBI) has issued instructions that each bank is required to have a loan recovery policy which sets down the manner of recovery of dues, targeted level of reduction (period-wise), norms for permitted sacrifice/waiver, factors to be taken into account before considering waivers, decision levels, reporting to higher authorities and monitoring of write-off/waiver cases.

Banks are required to monitor their NPAs and take steps to bring them down through upgradation/ recovery/prudential write off. Reserve Bank of India also monitors the NPA levels in banks.  This aspect is reviewed during Annual Financial Inspections of banks and monitored on an ongoing basis through regulatory returns submitted by banks and periodical meetings with banks.

The Government has advised Public Sector Banks (PSBs) to take a number of new initiatives to increase the pace of recovery and manage NPAs, which include appointment of Nodal officers for recovery, to conduct special drives for recovery of loss assets, to put in place early warning system, to replace system of postdated cheques with Electronic Clearance System (ECS), e-auctions, sharing of credit information through CIBIL, assigning of loss assets on incentive basis to Asset Reconstruction Companies and giving weightage to recovery of NPAs in Statement of Intent on annual goals of PSBs.

The details of Bank Group-wise reduction in NPAs by Scheduled Commercial Banks (SCBs) are as under:

(Amount in Rs. Crore)

This was stated by the Minister of State for Finance, Shri Namo Narain Meena in a written reply to a question in the Rajya Sabha today.

* * *

DSM/RS/ka

Loan recovery policy required: banks must set recovery targets, waiver norms and monitoring to reduce NPAs. Regulatory requirements mandate each bank to adopt a loan recovery policy detailing recovery methods, period-wise reduction targets, norms for waiver/sacrifice, decision levels, reporting and monitoring of write-off/waiver cases, while the Reserve Bank monitors NPA levels through inspections, regulatory returns and meetings with banks.