Bring in necessary legislation to prevent default: BEFI

There was an urgent need to bring in new legislation or necessary amendment to the existing Act for timely recovery of loans extended by nationalised banks so that huge NPAs can be prevented, Bank Employees Federation of India said today.
Releasing the list of defaulters of repayments of loans in various banks, numbering 1,129 Corporates and industries, amounting to nerly Rs 54,000 crore since 1991, R Maheswaran, Central Committee Member, BEFI, told reporters that this was the need of the hour to save the public sector banks.
In the absence of a stringent law, as the defaulters moved to court and obtain stay, the Government should bring in new legislation or make necessary amendments to existing Act, so as to prevent the NPAs in the Banks, which otherwise would not survive for long, Maheshwaran said.

The improper recovery system had resulted in two major public sector banks running into huge losses, he said.