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Banking sector crisis: Govt fixed responsibility on defaulters, says Goyal

Bad loans of PSBs were Rs 7.33 lakh cr as on June 2017, compared to Rs 2.75 lakh cr as on March 2015

Press Trust of India  |  New Delhi 

It is too early to go down the path of fiscal stimulus: Piyush Goyal

Blaming the previous for the current sector stress, said this has fixed responsibility on big and are being strengthened through various measures.

Before came to power, were pressurised to give loans aggressively between 2008-2014 despite irregular repayments by big borrowers, he said.

Loans were reclassified under corporate debt restructuring and structural debt restructuring for the purpose of ever-greening of those loans that were actually fallen into NPA category, Goyal told reporters.

"Through this, the losses of and their precarious position was kept under the carpet," he said.

The has taken various steps to help clean up their balance sheets and instituted asset quality review is one of them, he added.

Goyal said gross advances by public sector banks jumped nearly seven-times in nine years from Rs 8.08 lakh crore in March 2005 to Rs 52.15 lakh crore by March 2014, however, the didn't grow at a similar pace, meaning there was reckless and indiscriminate lending due to political pressures.

or of public sector banks (PSBs) were Rs 7.33 lakh crore as on June 2017, compared to Rs 2.75 lakh crore as on March 2015.

Goyal said the government is carrying "this legacy" created by the Congress-led regime before coming to power in mid-2014.

The said the government has every intention to solve this sector crisis.

RBI's asset quality review (AQR) mechanism, initiation of (IBC) and referring insolvent cases under the to recover sector dues are the steps that the government has already taken, he added.

First Published: Sat, December 16 2017. 22:08 IST