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The non-performing assets (NPAs) of banks in Odisha has climbed to 8.26 per cent by the end of March 2015 due to high slippages in the agriculture and MSME sector.
Out of total outstanding advances of Rs 94,755.02 crore made to various sectors by the banks, Rs 7,830.41 crore (8.26 per cent) loans have turned NPA by March end. NPA rate in the state is highest in case of agriculture term loans at 20.85 per cent, while it is 12.22 per cent for the overall agriculture sector.
MSME sector stood next to the agriculture sector in contribution to the stressed bank assets. The NPA of the MSME sector was 12.18 per cent by March end, 2015.
The education and housing sectors have NPAs of 8.40 per cent and 5.28 per cent respectively. NPAs in overall priority sector is 10.88 per cent, according to the data compiled by State Level Bankers' Committee (SLBC).
Loans are classified as NPAs if the borrower has failed to make interest or principal payments for 90 days.
Expressing concern on the mounting NPAs, SLBC said, the NPAs are on the higher side and alarming.
"For Prime Minister's Rozgar Yojana (PMRY), Prime Minister's Employment Generation Programme (PMEGP), Swarna Jayanti Shahari Rozgar Yojana (SJSRY), Self Help Groups (SHG) and Weaver Credit Card (WCC), the recovery performance, the NPA and overdue percentage are too high, which can only be rated as unsatisfactory", said the latest report of SLBC.
NPA rates for PMRY/PMEGP, SHG, SJSRY and WCC are 34.31 per cent, 22.04 per cent, 40.39 per cent and 44.65 per cent respectively.
The banks are unable to recycle the funds owing to non-repayment of loans, mounting overdue and rising NPA percentage. The banks and government departments have to make joint efforts with specific strategies to improve the recovery performance for better recycling of funds, added the report.
The SLBC has urged the state government to put in place a recovery mechanism to help the banks, so that they feel encouraged to advance loans to different sectors.
Similarly, the overdue percentage was alarmingly high at 51.55 per cent at the end of 2014-15. Any amount due to the bank under any credit facility, if not paid by the due date, becomes overdue.
Under the Odisha Public Demands Recovery Act (OPDR), 15,827 cases involving Rs 122.22 crore are pending for disposal at the certificate courts.
