RBI Working On Speedy Resolution Of Bad Loans, Says Arun Jaitley
The Finance Ministry is actively looking at PSU Bank consolidation, said Jaitley.
A speedy resolution of all pending cases of bad loans is required and the central bank is on the job, said Finance Minister Arun Jaitley after meeting chiefs of public sector banks.
About 81 cases have already been filed under the bankruptcy code, he said in a media briefing. The Reserve Bank of India is preparing a list of companies that require the Insolvency and Bankruptcy Code (IBC) process, he said.
Of these 81 cases, 18 cases have been initiated by the financial creditors. These are already before the NCLT (National Company Law Tribunal).Finance Minister Arun Jaitley after meeting public sector bank heads.
It was the first such meeting after the finance ministry passed the ordinance granting more power to the RBI to deal with the bad loan crisis. Public sector banks, including the country’s largest lender State Bank of India, have stressed assets worth more than Rs 10 lakh crore.
“Under the new ordinance which was issued, RBI is in fairly advanced stage of preparing list of those debtors where resolution is required through the ordinance," Jaitley told reporters after the meeting.
An internal advisory committee constituted by the RBI to “tackle non-performing assets” will soon take action, RBI Deputy Governor SS Mundra said at the briefing.
Jaitley On Performace And Consolidation
Jaitley, who took stock of the performance of the public lenders, said state-run banks made a stable profit of Rs 1.5 lakh crore in financial year 2016-17.
The government has been pushing the PSU banks to improve their performance and reduce NPAs by raising funds independently. Moody’s Investors Service estimates that 11 public sector banks, which it rates, would need up to Rs 95,000 crore over the next two years.
The finance ministry has also been actively looking at further consolidation within the state-run lenders, Jaitley said. The State Bank of India’s merger with its five associate banks and the Bharatiya Mahila Bank on April 1 and further consolidation is expected to help the sector compete with its global peers.
