Strategy to reduce non-performing loans

Dhaka,  Wed,  23 August 2017
Published : 13 Jun 2017, 19:27:47

Strategy to reduce non-performing loans

THIS refers to your thought-provoking article "Drawing up strategy to reduce non-performing loans" (FE- June 11). Over the years, much has been talked about non-performing loans and the emphasis so far has been only on identification and quantification of NPAs (Non Performing Assets) rather than on ways to reduce and upgrade them.  It is certainly not fair to blame banks for lending huge amounts to Vijay Mallya despite his failing business. RBI and the government should also not come in the way of the publication of names of wilful defaulters. It is baffling why officials are falling shy of making public a list of wilful defaulters. The public has a right to know how their money has been utilized. 

Measures are to be put in place to arrest this downward slide, and the deceleration of lending is definitely not the answer. There should be a monitoring agency to ensure that the directions of the central bank are obeyed scrupulously. The government has to act firmly if it wants to send out a clear message that it means business as far as putting an end to the burning issue of non-performing assets is concerned. Political interference in decision-making in public sector banks is the root cause of the non-performing loan mess.

Vinod C. Dixit

B-15 Jyoti-kalsh Society

Jodhpur Tekra, Ahmedabad, India
Editor : A.H.M Moazzem Hossain
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