New Delhi, June 5 (IANS) Finance Minister Arun Jaitley will on Monday hold a quarterly performance review with heads of public sector banks (PSB), said an official statement, at a time when these are severely stressed by bad loans and have incurred record losses in the last quarter.
Jaitley would “review the overall performance of PSBs during the financial year 2015-16 as well as with regard to the flow of credit to agriculture, insurance and MSE sectors among others”, the statement said.
The minister will also review the progress on the government’s new initiatives for financial inclusion, including Stand Up India, MUDRA Yojana, Pradhan Mantri Jeevan Jyoti Bima Yojana, Pradhan Mantri Surkasha Bima Yojana and Atal Pension Yojana among others, it added.
He will also take stock of the performance of PSBs with regard to the new projects and proposals and stalled projects.
Along with the heads od state-run banks and financial institutions, the meeting will also be attended by Minister of State for Finance Jayant Sinha, Department of Financial Services Secretary Anjuly Chib Duggal, and senior offiials, the statement added.
Gross non-performing assets (NPAs), or stressed loans, of PSBs rose from Rs 267,065 lakh crore in March 2015 to Rs 361,731 lakh crore in December.
As a proportion, the gross NPAs increased from 5.43 per cent of advances as on March 2015, to 7.3 per cent as on December-end.
Ten state-run banks suffered losses of over Rs.15,000 crore in the fourth quarter ended March because of provisioning made to cover for bad debt. Punjab National Bank, for instance, made an operational profit last year of Rs.12,000 crore, but has now declared a loss because of provisioning for NPAs.
In this connection, Jaitley has said NPAs were mostly due to business-related losses in certain sectors rather than frauds, and one must “distinguish between chalk and cheese”.