Finance ministry-PSU banks meet to review NPAs

Banks filing a petition with Delhi High Court against the demand of Rs 38,000 crore as service tax is also likely to be discussed in the meeting.

NEW DELHI: Finance ministry will hold a meeting with heads of all state-run lenders on Friday to review the bad loan situation, resolution through the Bankruptcy Code and other issues related to service tax.

In a missive sent to all public sector banks, the finance ministry said that the review meeting may be addressed by finance minister Nirmala Sitharaman. The meeting will also be attended by revenue and corporate affairs secretaries, the directive, reviewed by ET, said.

Banks filing a petition with Delhi High Court against the demand of Rs 38,000 crore as service tax is also likely to be discussed in the meeting.


The government raised demand on ground that banks asked customers to maintain minimum average balance (MAB) in bank accounts as a consideration for banking facilities provided free. A two-judge bench deferred the matter for further hearing on November 14.

The finance ministry had earlier noted that as a result of transparent recognition of stressed assets and subsequent initiatives of the government – recognition, resolution, recapitalisation and reforms – bad loans for PSBs have declined by Rs 89,189 crore to Rs 8.06 lakh crore as on March 2019. Non-performing assets of PSBs had increased to Rs 8.95 lakh crore in 2018 from Rs 2.79 lakh crore in March 2015.
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