PNB recovers Rs11,378 cr of bad loans in April-August FY19: report
11 Sep 2018
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The Punjab National Bank (PNB) has recovered close to Rs 11,378 crore from its borrowers in the first five months of FY19 both through effective deployment of staff and as plough back from the IBC.
According to a Financial Express report, the bank which was hit with a massive Rs 14,357 crore fraud committed by diamond trader Nirav Modi and his kin, has made a big leap in recovery of funds.
This compares with the Rs5,618 crore the bank recovered in FY18 and Rs5,643 crore recovered in FY17.
PNB got back Rs8,445 crore in the first quarter of FY19, which was 23 per cent of the total Rs 36,551 crore recovered by all the 21 public sector banks (PSBs).
The fraud-hit PNB was saved by the Rs3,081 crore it received from the acquisition of Bhushan Steel by the Tatas, close to Rs335 crore from Electrosteel and Rs110 crore from Monnet Ispat through the IBC process.
The report noted that the need to stay off the Reserve Bank of India’s (RBI) watch list, as well as concerns over profitability could be the prime motivator for the bank to recover these amounts at such a quick pace.
PNB also deployed close to 3,000 of its employees for the task of asset recovery.
PNB’s net NPAs stood at 10.58 per cent in the first quarter of FY19. In comparison, Bank of Baroda’s (BoB’s) NPAs were at 5.4 per cent, while Canara Bank’s NPAs were 6.91 per cent.
The Finance Ministry had earlier announced an infusion of capital in these PSBs to get them to meet regulatory requirements, but had since sought an action plan from the PSBs on how they would boost their business, tackle the staggering levels of non-performing assets (NPAs) and ensure profitability.
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