‘Banks may recover over Rs. 1 lakh crore’
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New Delhi: Enthused by the successful conclusion of the Bhushan Steel case, the Finance Ministry expects banks to write back more than Rs. 1 lakh crore after the resolution of all 12 NPA cases referred to insolvency proceedings by the RBI it its first list.
Last week, Tata Group acquired controlling stake of 72.65% in the debt-ridden Bhushan Steel Ltd. for about Rs. 36,000 crore which will help in cleansing the banking system as well as boost lenders’ profitability.
The remaining 11 NPA cases, which are in the pipeline, will easily bring to the table more than Rs. 1 lakh crore and the amount coming from resolution under the Insolvency and Bankruptcy Code (IBC) will directly add to the bottomline and help in reduction of NPAs of the public sector banks, a senior Finance Ministry official said.
Last year, in June, RBI’s internal advisory committee (IAC) identified 12 accounts, each having more than Rs. 5,000 crore of outstanding loans and accounting for 25% of total NPAs of banks.