By Sidhartha Dutta
New Delhi, June 10 (IANS) The State Bank of India (SBI), the country’s largest public sector lender, recorded its highest non-performing asset (NPAs) of Rs 1.1 lakh crore in 2017-18, almost equal to what it had registered in the decade before, according to information available through RTI and the bank’s annual report.
The gross NPAs of the bank went up from Rs 1.12 lakh crore in 2016-17 to Rs 2.23 lakh crore in the last fiscal.
This happened while the Bharatiya Janata Party (BJP)-led government completed nearly four years in office.
The bank, in a reply to an RTI application by IANS, said that the gross NPAs of SBI till December 31, 2016, were Rs 1,123,43 crore. On December December 31, 2017, the NPAs were Rs 1,99,141 crore — a net increase of Rs 86,798 crore. The SBI’s annual report showed that the gross NPAs till the end of 2017-18 were Rs 2,23,427 crore.
According to the bank, the rising NPA levels and fresh slippages across sectors could be attributed to i) inadequate pick-up in the global economy and negative spillovesr from the global financial markets; ii) less than adequate pick-up in domestic growth and declining exports; and iii) delay in realisation of receivables due to subdued demand, reduced market confidence and stress in steel, power and infrastructure projects.
According to the bank’s reply, the gross NPAs of the bank in 2016-17 registered a net increase of Rs 14,170 crore from 2015-16.
The net increase in the NPAs from 2014-15 (Rs 56,725 crore) to 2015-16 (Rs 98,173 crore) was Rs 41,448 crore, which was the second-highest in a decade.
There was a decline in the gross NPAs of SBI from Rs 61,605 crore in 2013-14 to Rs 56,725 crore in 2014-15, going down by Rs 4,880 crore. This was during the United Progressive Alliance’s (UPA) rule at the Centre.
From 2012-2013 (Rs 51,189 crore) to 2013-14 (Rs 61,605 crore), there was a net increase in the gross NPAs of SBI of Rs 10,416 crore.
The RTI reply also says that the net increase in the gross NPAs of SBI from 2011-12 (Rs 39,676 crore) to 2012-2013 (Rs 51,189 crore) was Rs 11,513 crore while from 2010-11 (Rs 25,326 crore) to 2011-12 (Rs 39,676 crore) it was Rs. 14,350 crore.
From 2009-10 (Rs 19,535 crore) to 2010-11 (Rs 25,326 crore) the net increase in the NPAs was Rs 5,791 crore and the increase from 2008-09 (Rs 15,714 crore) to 2009-10 (Rs 19,535 crore) was Rs 3,821 crore.
It also mentions that the net increase in the NPAs from 2007-08 (Rs 13,160 crore) to 2008-09 (Rs 15,714 crore) was Rs 2,554 crore.
Asked what the SBI was doing to reduce NPAs, it said it had taken a few steps to reduce them. “In cases where soft recovery measures do not fructify, legal action is initiated like action under SARFAESI Act, filing suits in Debt Recovery Tribunals and other Courts. Depending on the merits of the case, recourse to higher courts like High Courts and the Supreme Court is also taken,” it said.
It further said that SBI was arranging Bank Adalats and actively participating in Lok Adalat for recovery. It also mentioned E-Auction for increased transparency and better price realisation.
Among other steps for recovery, the bank enumerated: 1) Sale to ARCs is also explored in select cases; 2) Resolution of NPA through the new Bankruptcy Law is also resorted to effectively, since the provisions of SICA Act have been brought under new Bankruptcy Law; 3) Identifying and engaging with strategic investors for takeover of stressed assets; 4) Entering into One-Time Settlement with borrowers.
It also moved to declare borrowers as wilful defaulter on a case-to-case basis and it aimed to persuading large corporate borrowers under stress to sell non-core assets, dilute their shareholding and bring in strategic investors, thus reducing debt and improving viability.
It said that a number of properties were successfully sold across all geographies through mega e-auctions.
It said that in “compromise cases”, the Bank endeavoured to recover its dues to the maximum extent possible with minimum sacrifice.
(Sidhartha Dutta can be contacted at email@example.com)