{"id":5983,"date":"2018-04-04T10:43:39","date_gmt":"2018-04-04T05:13:39","guid":{"rendered":"https:\/\/teekhapan.wordpress.com\/?p=5983"},"modified":"2018-04-04T10:43:39","modified_gmt":"2018-04-04T05:13:39","slug":"89-of-bad-loans-written-off-by-public-sector-banks-are-not-recovered","status":"publish","type":"post","link":"https:\/\/vivekkaul.com\/2018\/04\/04\/89-of-bad-loans-written-off-by-public-sector-banks-are-not-recovered\/","title":{"rendered":"89% of Bad Loans Written Off by Public Sector Banks are Not Recovered"},"content":{"rendered":"
\n\u201cYou don\u2019t get bored writing about bad loans of public sector banks?\u201d asked a friend, a few days back.<\/p>\n
We honestly told them, we don\u2019t, simply because new details keep coming out, and we keep writing about them. And most of these new details show how messy the situation has become.<\/p>\n
Yesterday, while digging through the questions raised by MPs in the Rajya Sabha, we came across another interesting data point, which again shows how messy the bad loans problem of public sector banks actually is and why it is not going to end anytime soon, irrespective of what analysts and politicians have to say about it.<\/p>\n
Bad loans are essentially loans which have not been repaid for a period of 90 days or more.<\/p>\n
After a point banks need to write-off bad loans. These are loans which banks are having a difficult time to recover.<\/p>\n
When banks write-off bad loans, the total bad loans of the banks come down. At the same time, these bad loans are written-off against the operating profits of banks.<\/p>\n
In an answer to a question raised in the Rajya Sabha, the government gave out the details of the total amount of bad loans which have been written off by public sector banks, over the last few years.<\/p>\n
Take a look at Table 1:
\nTable 1:<\/p>\n