Post News Network
Bhubaneswar, July 27: Accretion of bad asset seen in the banking system is alarmingly high, which may curb lending activities of banks in the state, a top official of State Level Bankers’ Committee (SLBC) said. “NPA (non-performing asset) as well as overdue of the banks in the state has increased alarmingly during last fiscal, which may affect lending process of banks. NPA of banks during last fiscal has increased to 8.26 per cent against 7.69 per cent in FY14 and overdue to a level of 51.55 per cent in FY15,” SLBC Convener, BP Samantaray said.
On rising bad asset level, Samantaray said lenders are unable to recycle funds owing to defaults in repayment of loans. This factor has also picked up overdue level in the state. “Rising NPA as well as overdue in the state can be rated as unsatisfactory. Banks and government departments have to make joint effort with specific strategies to improve the recovery performance for better recycling of funds,” Samantaray said adding that SLBC is urging the state government to constitute a recovery mechanism which will help the banks to recover pending dues and encourage them to disburse credits to different sectors.
Elaborating on NPA level seen in different sectors, he said NPA in agriculture term loan stood at 20.85 per cent with an overdue of 50 per cent. Meanwhile, total agriculture lending stood next to it with an NPA of 12.22 per cent and overdue of 42.33 per cent. He also said NPA level of Micro Small and Medium Enterprises (MSME) sector in state was at 12.18 per cent with an overdue of 51.56 per cent. “Topping the list of over dues in various sectors were education loans,” he added. On total NPA and overdue level in priority sector, Samantaray said, “NPA in the total priority sectors was at 10.88 per cent with overdue standing at 46.44 per cent.”