Concerned over the rising bad loans of banks, Finance Minister Pranab Mukherjee said on Wednesday that the issue of non-performing assets (NPAs) needs to be addressed on priority basis.
“The banks are facing the problem of increasing NPAs which needs to be addressed on priority,” Mukherjee said, at a meet of Chairpersons of Debt Recovery Appellate Tribunals (DRATs) and Presiding Officers of Debt Recovery Tribunals (DRTs) here.
He said banks have been asked to closely monitor their NPA situation.
The NPAs of public sector banks stood at about 3.3 per cent of the assets in 2011-12 as against 2.3 per cent a year ago.
The Reserve Bank of India (RBI) too recently advised some public banks to take necessary steps for appropriate NPA management.
Financial crisis
Pointing out that there can be no lending unless there is recovery, Mukherjee asked the participants to suggest ways and means to expedite the unlocking of resources of various banks locked in the form of NPAs.
In a financial crisis, he said, role of DRTs is more important in helping out banks to deal with the mounting NPAs as they are part of the mechanism to recover bad assets.
Loans of banks to 7-8 sectors including power and distribution companies (discoms), civil aviation and textiles are under large stress.