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Take urgent remedial steps to contain NPAs: Parliamentary panel to govt

The committee has also made a case for amending banking laws, including the SBI Act, to provide for disclosure of names of loan defaulters

Press Trust of India  |  New Delhi 

Union Finance Minister Arun Jaitley is expected to address the two-day conclave at the State Bank of India (SBI) Academy in Gurugram

Concerned over rising NPAs of the banks, a Parliamentary panel asked the government to take urgent remedial measures to reduce volume of stressed assets in the system and strengthen mechanism.

The Committee on in its reports said that it is constrained to note that even after having a 'mechanism' in vogue in the system, there are incidences of relating to non-performing assets (NPAs).

"In this regard, the Committee opined that merely issuing of guidelines or advisories by the government or the for averting the incidences of relating to NPAs do not seem to have yielded the desired and the RBI-being a Regulator - does not seem to have succeeded in so far as implementation and enforcement of its own guidelines is concerned," it said.

The Committee, therefore, recommended the government to impress upon the Reserve of (RBI) to monitor and follow up strict compliance of the relevant instructions with the and financial institutions on a regular basis, the panel added.

It also recommended that the existing mechanism should be re-visited and, if required, the same be amended to provide more teeth to existing mechanism.

There is a need for establishment of a more robust vigilance mechanism to put a check on the incidences of irregularities, malpractices, corruption, etc, at all levels in the functioning of

The committee has also made a case for amending laws, including the SBI Act, to provide for disclosure of names of loan defaulters.

The panel had recommended that the government make appropriate amendments in "the archaic provisions of the SBI Act and other relevant laws to disclose the names of individuals who owe money to the or are responsible for bad loans on account of their default to repay".

In this regard, it said the Committee appreciated that was in favour of making available information on 'wilful defaulters' in public domain.

However, it added, the (Department of Financial Services)/are of the opinion that the disclosure of information of other defaulting borrowers may not be in the interest of the revival of their distressed business units, which may be otherwise viable.

It reiterated that they should undertake an "objective examination and analysis of the extant provision(s) for disclosure of details of loan defaulters in public domain by amending the existing relevant Acts/Rules vis-a-vis interest of the revival of their distressed business units without having any impact on their viability".

First Published: Mon, December 25 2017. 00:42 IST