Banks write off over ₹2.09 lakh crore bad loans in FY23; ₹10.57 lakh crore in last 5 years

News Network
July 24, 2023

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Banks in India wrote off bad loans totaling more than ₹2.09 lakh crore during the FY23, according to information obtained through Right to Information (RTI) queries. 

This brings the total loan write-offs by the banking sector to a significant ₹10.57 lakh crore in the past five years, as per data provided by the Reserve Bank of India (RBI).

Loan write-offs by banks increased to ₹209,144 crore during FY23, compared to ₹174,966 crore in FY22 and ₹202,781 crore in FY21, as per the RTI data. Banks have been utilising loan write-offs as a strategy to reduce the burden of non-performing assets on their books. 

However, the recoveries from these written-off loans have been quite dismal, with only ₹30,104 crore recovered in FY21, ₹33,534 crore in FY22 and ₹45,548 crore in FY23.
 
The RBI's RTI response reveals that out of the ₹586,891 crore loans written off in the last three years, banks were able to recover only ₹109,186 crore, indicating a meagre recovery rate of 18.60% during this period.

The loan write-offs have helped banks in reducing their Gross Non-Performing Assets (GNPA) to a 10-year low of 3.9% of advances by March 2023. Over the years, gross NPAs of banks have decreased from ₹10.21 lakh crore in FY18 to ₹5.55 lakh crore by March 2023, mainly due to the impact of loan write-offs.

Taking this into account, the total defaulted loans (including write-offs but excluding recovered loans) amount to approximately ₹10.32 lakh crore. If the write-offs are included, the total Non-Performing Asset (NPA) ratio would have been 7.47% of advances, higher than the 3.9 percent reported by the banks.

What happens when a loan is written off?

When a bank writes off a loan, it removes it from the bank's asset book. This action is taken when the borrower has failed to repay the loan, and the chances of recovering the outstanding amount are very low. 

The defaulted loan, also known as NPA, is then transferred from the assets side and recorded as a loss. A loan is classified as an NPA when the borrower fails to make the principal or interest payment for a period of 90 days or more.

Even after the write-off, the bank is required to continue its efforts to recover the loan using various options. Provisioning must also be made for the written-off amount. As a result of the write-off, the bank's tax liability is reduced as the written-off amount is deducted from the profit.

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News Network
November 16,2024

Mangaluru: The Kavoor police in Mangaluru, Karnataka, have arrested three individuals from Kerala in connection with two separate cybercrime cases, including one involving extortion under the guise of a "digital arrest."

City Commissioner of Police Anupam Agrawal reported that one of the arrested individuals, Nisar, a resident of Ernakulam district, posed as a CBI officer. He allegedly threatened the complainant with arrest and extorted Rs 68 lakh. A case has been filed under sections 66 (C) and 66 (D) of the IT Act, and sections 308 (2) and 381 (4) of BNS.

In another case, the Kavoor police arrested two men, Sahil K P of Thiruvannur, Kozhikode, and Muhammad Nashath of Mappila Koyilandy, Kerala, in connection with a share trade fraud. The accused are alleged to have deceived the complainant by promising substantial profits from an investment in the stock market. Trusting the fraudsters, the complainant invested Rs 90 lakh, which was subsequently lost. A case has been registered under sections 66 (C) and 66 (D) of the IT Act, and sections 318 (4) and 3 (5) of BNS.

The accused were arrested in Koyilandi and presented before the court. The operation was carried out under the guidance of City Police Commissioner Anupam Agrawal, led by Mangaluru North Sub-Division ACP Srikanth K, Kavoor Inspector Raghavendra Byndoor, Kavoor PSI Mallikarjuna Biradara, and staff members Ramanna Shetty, Bhuvaneshwari, Rajappa Kashibai, Praveen N, and Malatesh. 

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News Network
November 19,2024

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The Karnataka Police’s Anti-Naxal Force (ANF) achieved a major breakthrough on Monday night by eliminating Vikram Gowda, one of Karnataka’s most wanted Naxal leaders for over two decades. The encounter occurred in the dense Kabbinale forest of Udupi district, marking a significant victory against Naxal insurgency in the region.

Who Was Vikram Gowda?

Hailing from Hebri in Udupi, Vikram Gowda, 44, was a prominent figure in the Naxal movement. He went underground in 2002, initially serving as a courier and fund collector before rising to lead a breakaway Naxal group. Despite having only a fourth-grade education, he was a staunch advocate for tribal rights and a key player in the movement’s survival in Karnataka.

Bounty: ₹3 lakh from Karnataka and ₹50,000 from Kerala.

Legacy: The last major Naxal leader in Karnataka after the 2021 arrest of B G Krishnamurthy.

The Encounter

Police revealed that Gowda and his team visited Kabbinale village to collect groceries on Monday night. Acting on a tip-off, ANF ambushed the group. When the Naxals opened fire, ANF responded, leading to Gowda's death.

Escapees: Three Naxals fled, including prominent members Latha (aka Mundgaru Latha) and Raju.

Significance: This was the first Naxal casualty in Karnataka in over two decades.

Home Minister G. Parameshwara confirmed the operation, stating, “Gowda was elusive for 20 years, escaping multiple encounters. His death is a critical step in dismantling Naxal operations in the region.”

The Decline of Naxal Activity in Karnataka

Karnataka's Naxal movement has been dwindling, with members seeking refuge in Kerala and Tamil Nadu. The group’s strength had reduced to just 19 members by 2018, but recent sightings indicate attempts at revival:

2023 Activity: Reports of Gowda-led movements in the Kodagu and Hassan districts reignited concerns.

Political Heat: The BJP criticised the Congress government, alleging it created a “safe haven” for Naxals.

A Glimpse into Gowda’s Past

Personal Life: Gowda’s ex-wife, Savitri (alias Rajita), was arrested in 2021. She was a senior Naxal commander involved in insurgency since 2004.
Rehabilitation Efforts: Since 2013, Karnataka’s rehabilitation policy has seen 14 Naxals surrender and reintegrate into mainstream society.

A Milestone in Karnataka’s Fight Against Insurgency

The operation signifies a decisive blow to Naxal resurgence in the Western Ghats. While the ANF continues its search for escapees, the Karnataka government reaffirmed its commitment to offering rehabilitation to those willing to surrender.

As Karnataka celebrates this triumph, the message is clear: there is no room for insurgency in the state.

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News Network
November 17,2024

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An Israeli airstrike on the office of Syria’s Baath party in Lebanon’s capital Beirut has killed the Lebanese resistance movement Hezbollah's Media Relations Officer, Mohammad Afif, reports say.

Lebanon's National News Agency (NNA) reported that the Israeli raid struck the Ba'ath party’s building in central Beirut district of Ras Al-Naba'a on Sunday, adding that the strike was an attempt to assassinate the leader of the resistance media front.

According to Baath Secretary-General Ali Hijazi, Afif was having a meeting in the Baath Party headquarters when Israel carried out the attack.

"Afif did not fight with weapons and did not lead a military unit in Hezbollah. Rather, he led a media unit," he said.

Reuters, Sky News, Al Jazeera and a number of Henrew-language media reported that Afif was killed in the Israeli strike.

However, Hezbollah has not yet confirmed Afif’s death or whether he was present at the site or not.

Earlier, the Lebanese Health Ministry said at least one person was killed and three others injured after an Israeli strike targeted a central district in Beirut.

Lebanon's al-Mayadeen television network reported that five people were killed in the attack.

The latest development came after Afif said Hezbollah was behind the Caesarea operation and targeting Netanyahu’s home during a speech at the Ghobeiry area in the southern suburbs of Beirut on October 22.

This was the second assassination attempt on Afif in the last two months, after he survived an attack on the Hezbollah media relations office several weeks ago.

Israel launched a ground assault and massive air campaign against Lebanon in late September after a year of exchanging fire across the Lebanese border in parallel with the Gaza war.

At least 3,287 people have been killed in Israeli strikes in Lebanon over the past year, with the vast majority in the past seven weeks. Another 14,222 have been wounded, mostly women and children.

In response to the ongoing aggression, the Lebanese resistance movement Hezbollah has been staging hundreds of retaliatory strikes against the occupied Palestinian territories and the Israeli forces trying to advance on southern Lebanese areas.

The movement has vowed to sustain its strikes until the regime ends the escalation.

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