Jail wilful bank defaulters: Sinha

By Our Special Correspondent

NEW DELHI, JULY 13. The Union Finance Minister, Mr. Yashwant Sinha, has suggested that wilful defaulters of bank loans be sent to jail.

Addressing a meeting of the chief executives of public sector banks today, Mr. Sinha is reported to have said that if small borrowers could be sent to jail, why should not the big borrowers be given the same treatment, the Secretary (Banking), Mr. Devi Dayal, told presspersons.

When it was pointed out that law did not permit stringent punishment for wilful default such as confiscation of property or other measures, Mr. Dayal said these borrowers were normally tried by the Debt Recovery Tribunals (DRTs) and amendments to the DRT Act provide for harsh punishment.

Mr. Dayal said the non-performing assets (NPAs) or bad loans had gone up by Rs. 1,700 crores during the last fiscal, whereas they had increased by Rs. 6,000 crores during 1999-2000. While the gross NPAs had come down to 13 per cent of the total outstanding in the last financial year, the net NPAs had declined from 8 per cent to 7 per cent.

He said the conference was informed that 99,425 employees of the banking industry had opted for the voluntary retirement scheme (VRS) and the sum involved amounted to Rs 10,073 crores. Of this, about 20 per cent was provided during the last fiscal year and the rest would be amortised for a period of 5 years.

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Section  : National
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