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Scam-hit Punjab National Bank has seen nearly 23 per cent jump in the amount which wilful defaulters owe it, with loan outstanding of Rs 25,00,000 and above, in just over eight months ended January. The wilful defaulters who have taken loans over Rs 25,00,000 from the bank had a gross outstanding against them of Rs 145 billion as on January 31, 2018, as per PNB data.
The bank first started giving out such data from June 2017, when the gross loan outstanding against them was at Rs 118 billion. The amount has grown over 22.8 per cent in these eight months. The rise in such outstanding is startling, especially when the bank has been aggressive for over a year now in recovering bad loans.
The 123-year old bank has unearthed Rs 114 billion fraud allegedly involving billionaire jeweller Nirav Modi and associate companies. The fraud pertains to issuance of fake Letters of Understanding (LoUs) to companies associated with Modi by errant PNB employees that enabled these companies to raise buyers credit from international branches of other Indian lenders.
The list of wilful defaulters with over Rs 25,00,000 loan as on January 31, 2018 include Rs 7.47 billion against Forever Precious Jewellery & Diamonds; Rs 5.9 billion against Kingfisher Airlines; Rs 4.10 billion against Zoom Developers and Rs 2.6 billion against MBS Jewellers Pvt Ltd among others. PNB CMD Sunil Mehta said last week that the bank would take all the legal action to bring the perpetrators to the books and that it will also honour all its bonafide commitments. PNB has been putting out the list of wilful defaulters since June 2013 which it continued till May 31, 2017.
Since then it is only listing out those wilful defaulters with outstanding of Rs 25,00,000 and above with their names/proprietorship from June last 2017. Bank's net non-performing assets (NPAs) or bad loans fell to Rs 340 billion at the end of third quarter ended December of the current fiscal, from Rs 349 billion at end-December, 2016. Gross NPAs were up however at Rs 575 billion as on December 31, 2017 as against Rs 556 billion by the same period of previous fiscal.
In terms of ratio, the net NPAs fell to 7.55 per cent of the net advances by end of third fiscal 2017-18 from 9.09 per cent in the year ago same quarter. Gross NPAs were 12.11 per cent, as against 13.70 per cent. Post the third quarter earnings announcement on February 6, Mehta said he hoped to see good recoveries in bad loans in the last quarter ending March 2018.
The bank has about 95 accounts in the NCLT (National Company Law Tribunal) with total exposure of Rs 180-190 billion. For smaller loans, the bank has undertaken a one-time settlement scheme to clean up its books. The recoveries through this scheme have been around Rs 18 billion so far in 2017-18.