“Bad debts only ailment of public sector banks”

Kolkatta The Hindu 19 July 14

Non performing assets of 26 Indian PSBs calculated in 2014 was Rs. 1,30,360 crore, up from Rs. 89,950 crore in 2013

Although the quality of service rendered by public sector banks (PSB) is far better than that of private or foreign banks in the country, the “only ailment” plaguing PSBs are bad debts or non performing assets (NPA), general secretary of the Bank Employees’ Federation of India Pradip Biswas told media persons here on Friday.

Releasing a booklet bearing names of the top loan defaulters taken from Indian nationalised banks based on the research and calculations of the Federation, Mr. Biswas said a lion’s share of the operating profit of every PSB is set aside every year to provide for NPA and is a “loot of public money.”

“The big corporate houses, having appropriate political patronage are the major culprits. Bank employees’ movement and other Left and democratic forces have long been demanding publication of the list of defaulting corporate borrowers responsible for growing NPA; successive governments have stonewalled the demand,” the Leftist bank employees union stated.

The union says , the net NPA of 26 Indian PSBs calculated in 2014 was Rs. 1,30,360 crore, up from Rs. 89,950 crore in 2013, almost a 45 per cent increase.

“Based on our research and calculations, Kingfisher Airlines, Dunlop and media group Anandabazar-Jugantor are one of the top loan defaulters,” Mr. Biswas said. Expressing his dissatisfaction over the recommendations of the P.J. Nayak Committee, Mr. Biswas said: “The Committee suggested lowering the government’s holding in banks below 50 per cent. We strongly oppose it and have submitted a memorandum to [Union Finance Minister] Arun Jaitley on June 27. He gave us a patient hearing and assured us that he would look into the matter.”

“Because of the presence of a strong public sector, the financial sector in our country, though affected, has not crushed down with the meltdown of the financial sector in the U.S.A. and other major economies of the capitalist world,” he said.