Money & Banking

Bank defaulters: AIBEA releases list of 2,426 borrower accounts

KR Srivats New Delhi | Updated on July 18, 2020

C.H. Venkatachalam, General Secretary, AIBEA

Clean-up measures Once declared a wilful defaulter, a borrower/guarantor will remain in that category till the closure of the loan, irrespective of the outstanding in the account

Ordinance is a must to recover dues to the banking system, says AIBEA General Secretary Venkatachalam

On the eve of 51st anniversary of Bank nationalisation, the All India Bank Employees Association (AIBEA) on Saturday released the list of 2,426 borrower accounts that have been categorised as “wilful defaulters” with dues amounting to ₹1,47,350 crore to the banking system. These wilful defaulters list pertained only to public sector banks and based on Central Repository of Information on Large Credits (CRILC) report as of September 30 last year.

“The key findings for us is that most of these wilful defaulters are reputed companies and are going concerns. Criminal action should be taken as they all have the means to pay and capacity to pay with enough assets. Why banks should suffer?”, C H Venkatachalam, General Secretary, All India Bank Employees Association (AIBEA) told BusinessLine.

He suggested these cases should not go to NCLT and the Centre should bring a special ordinance to confiscate their property and recover the money from these wilful defaulters.

“These are all wilful defaulters. At least on them, the Government must take immediate action. They must be differentiated from those defaulters who have genuine reasons. These are all going concerns and they do have other assets to repay the money. Hence they should not be given any concessions under NCLT or IBC”, he said.

Venkatachalam also highlighted instances of certain cases getting categories as wilful defaulters in certain banks, even while remaining a standard account in others.

He highlighted that public sector banks have become the engines of growth and development and banks must be strengthened further to achieve Atma Nirbhar.

“The only major problem faced by our banks is the bulging and alarmingly high bad loans by private companies and corporates. If tough action is taken on them and money is recovered, our banks can play a bigger role in national development”, he said.

The present practice of giving concessions to the defaulters and burdening the banking public with lesser rate of interest on their savings and increase in service charges should be stopped, Venkatachalam said.

As per the AIBEA list, top 33 accounts with exposure of ₹ 500 crore and above accounted for aggregate dues of ₹ 32,737 crore. These include Gitanjali Gems (₹ 4,644 crore); ABG Shipyard ( ₹ 1,875 crore); Rei Agro (₹ 2,423 crore); Ruchi Soya Industries (₹ 1,618 crore); Gilli India ( ₹ 1,447 crore); Winsome Diamonds and Jewellery (₹ 2,918 crore); Kudos Chemie (₹ 1,810 crore), Nakshatra Brands (₹ 1109 crore) and Kingfisher Airlines (₹ 586 crore). Some of these accounts held exposure less than ₹ 500 crore in some banks.

Among the banks, SBI, the country’s largest commercial bank, had the highest number of 685 wilful defaulter borrowers amounting to ₹43,887 crore.

Published on July 18, 2020

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