Banks Write Off Record NPAs as Recovery Efforts Intensify

Indian banks have written off non-performing assets (NPAs) worth Rs 16.35 lakh crore in the last decade. Despite significant write-offs, banks continue to pursue recovery actions under various legal frameworks. Meanwhile, the government plans to establish the 8th Central Pay Commission to evaluate financial implications.

In a decade-long effort to manage non-performing assets (NPAs), Indian banks have written off bad loans totaling approximately Rs 16.35 lakh crore, revealed the government on Monday. The highest write-off, amounting to Rs 2,36,265 crore, occurred in the 2018-19 fiscal year, with the lowest recorded in 2014-15 at Rs 58,786 crore.

During the fiscal year 2023-24, banks wrote off Rs 1,70,270 crore, following the guidelines of the Reserve Bank of India and policies approved by banks' boards. Finance Minister Nirmala Sitharaman emphasized that such write-offs don't waive borrower liabilities, and banks pursue various recovery strategies, including legal suits and tribunal actions.

Additionally, 29 unique borrower companies have been classified as NPAs with each having outstanding dues of Rs 1,000 crore or more, totaling Rs 61,027 crore. The government also announced plans for the 8th Central Pay Commission, aimed at assessing financial impacts once recommendations are finalized and accepted.

(With inputs from agencies.)