)
Central Bank of India has topped the list of public sector banks (PSBs) with the largest bad loans, including restructured assets as a percentage of total advances.
According to the data provided by the Reserve Bank of India (RBI) to the finance ministry, Central Bank of India’s 21.5 per cent assets are either bad or have been restructured to save these turning into non-performing assets (NPAs). The other banks which have significant amount of gross NPAs and restructured loans are United Bank of India (19.04 per cent), Punjab & Sind Bank (18.25 per cent) and Punjab National Bank with 17.85 per cent as on December 2014.
Indian Overseas Bank, State Bank of Patiala, Allahabad Bank and Oriental Bank of Commerce all have bad and restructured loans in excess of 15 per cent. The rising bad loans have become a major concern for RBI and the government.
Most of the restructured loans are from the corporate sector. The top 30 defaulters are sitting on bad loans of Rs 95,122 crore, more than one-third of the gross non-performing assets of PSBs at Rs 2,60,531 crore as on December 2014.
There are four kinds of restructuring. The first is restructuring of advances extended to industrial units, then restructuring under corporate debt restructuring and restructuring of loans extended to micro, small and medium enterprises according to RBI guidelines. However, banks have their own operational rules for restructuring of small loans.
RBI has not prescribed any board or bank level position at which these loans need to be approved.
