Punjab National Bank (PNB) has set up a loan recovery cells in all of its 6,900 branches each and about 25,000 employees will be deployed to recover bad loans. The state bank has also created a stressed asset vertical at its main headquarters, a report mentioned. Four general managers are appointed to pace up the recovery of non-performing assets (NPAs).
The report quoted sources as saying the bank has trained its resources on recoveries and is set to meet the target set for the quarter ended June 2018. Around 3,000 officials from different operations have been moved to the stressed asset vertical, whose primary job will be to focus on recoveries. The stressed assets vertical had started operating from June 1.
It may also be noted that the bank has already recovered toxic loans worth Rs 7,000 crore while the set target is Rs 8,000 crore for this quarter which is about to end in another 10 days. State-controlled PNB is expected to get over Rs 3,300 crore from the likely resolution of Bhushan Power, Essar Steel, Ruchi Soya and Andrak Aluminium under the Insolvency and Bankruptcy Code (IBC), says a report.
It is worth mentioning here that PNB registered a loss of Rs 13,416.91 crore for the fourth quarter ended March 2018, the biggest ever by any public sector bank. The bad loans grew to Rs 86,620 crore at the end of March 2018 from Rs 55,370 crore a year ago.
Fugitive diamond jeweler Nirav Modi and his uncle Mehul Choksi, in connivance with a certain few PNB executives, allegedly cheated the bank of nearly Rs 14,600 crore through fraudulent letters of undertaking (LoUs).
Earlier this month, a parliamentary panel had asked bankers to make a roadmap to deal with rising bad loans in the system, which touched Rs 8.31 lakh crore in end-December 2017. According to rating agency Crisil latest report, the NPAs in the banking system to peak at around 11.5 per cent this fiscal and then start reducing.
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