Tribune News Service
New Delhi, November 29
Scheduled Commercial Banks have written-off loans of Rs 46,382 crore during the first six months of the current financial year 2021-22, the government said in the Lok Sabha on Monday.
However, the Union Finance Ministry declined to provide details of major corporates whose loans were written off citing Section 45E of the RBI Act which prohibits disclosing credit information. Section 45E provides that credit information submitted by a bank shall be treated as confidential and not be published or otherwise disclosed.
As per the RBI data on global operations, bad loans whose full provisioning has been made on completion of four years are removed from the balance-sheet by way of write offs. This evaluation by banks is part of their regular exercise to clean up their balance-sheet, avail of tax benefit and optimise capital. This is in accordance with RBI guidelines and policy approved by the bank boards, said the government.
The written-off loans do not let the borrowers off the hook. They 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 by filing suits in civil courts or in Debts Recovery Tribunals, action under the Securitisation Act, filing of cases in NCLT through sale of non-performing assets.
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