Tag: covid

SBI Cards Q4 spends point to a worsening Covid impact, BFSI News, ET BFSI

Banking & Finance

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SBI Cards and Payment Services Ltd’s showing a slowdown in business in the fourth quarter, when the new Covid wave was not prominent in India.

The company reported a weak fourth quarter, with a sequential decline in receivables/spending.

The spends

While overall spends rose 11% year on year (YoY) they logged a 5% decline sequentially, within which retail spends were up 13% YoY (-4% QoQ), while corporate spends declined 10% QoQ (flat YoY).

Retail spends remained higher than pre-Covid levels, while corporate spends reached pre-COVID levels – on the back of new use cases making up for the loss in travel spends. Online retail spends form ~52% of the total retail spends.

This development comes when a major rival HDFC Bank is hamstrung as RBI has barred it from issuing new credit cards.

According to the management, spends across categories, barring travel and entertainment, have reached pre-Covid levels. Corporate spends have also reached pre-Covid levels, while corporate travel remains impacted. New use cases across corporates have been making up for the loss in travel spends.

However, the YoY growth is far lower than the pre-pandemic growth trend, which remains a worry.

Also, the gross non-performing assets (GNPA) ratio increased to 4.96% (versus proforma 4.51% in the December quarter), while the NNPA ratio declined to 1.15% (versus 1.58% in the third quarter of FY21).

Total receivables

Total receivables grew 4% YoY (2.5% QoQ decline) to Rs 25110 crore. The receivables mix indicated a marginal increase in the number of transactors and decline in revolvers – resulting in moderation in yields and an impact on the margins. Receivables per card continued to decline, reaching Rs 21,000 crore in the fourth quarter.

With the spends towards essentials are small in size than discretionary, the second wave of the pandemic poses significant risks to growth for SBI Card.

SBI Cards results

SBI Cards reported net profit growth of 110% YoY to Rs 175 crore, which was below analyst estimates. It was affected by a 21% YoY/8% sequential decline in interest income and modest fee income. Although, lower opex supported pre-provision operating profit (PPoP). For FY21, NII (net interest income)/PPOP was up 9.7%/9.6% YoY, while PAT declined ~21% YoY. NII declined 18.3% YoY, with margins down 130bp QoQ to 13.2%. Income from fees and services was stable QoQ at INR11.1b (+16% YoY) as overall spends declined ~5% QoQ. Thus, total income grew 2% YoY to INR22.2b, while opex declined 4.6% QoQ, resulting in stable PPoP (9% miss).

Cards in force grew 12% YoY to 11.8 million. New account sourcing for the fourth quarter stood at 93% of 4QFY20 levels. SBI contributed ~54% to new cards sourced, which accounts for ~44% of the overall card base.

For the financial year ended March 31, total income was at Rs 9,714 crore for FY21 vs Rs 9,752 crore for FY20. The profit after tax came at Rs 985 crore for FY21 versus Rs 1,245 crore in the previous fiscal.

The total balance sheet size as of March 31, 2021, was Rs 27,013 crore as against Rs 25,307 crore as on the same date of last year.



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Budget proposal has not affected ULIP segment of ICICI Pru Life: MD and CEO

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Optimistic about the outlook for the life insurance industry, NS Kannan, Managing Director and CEO, ICICI Prudential Life Insurance, said as of now Covid-related claims for the sector are under control. In an interview with BusinessLine, he said while there continues to be demand for protection and health products, underwriting norms have become stricter for retail protection. Excerpts:

What is your outlook for the life insurance sector?

Amidst the pandemic, life insurance sector ended in the growth path. I expect the industry will see double-digit growth. We will have to watch how the pandemic develops but we will get back in line with nominal GDP growth of about 15 per cent.

Is the surge in Covid 19 infections a cause for concern for the sector?

Our industry’s claims will be linked to overall mortality of the insured population, which is very much under check. I don’t think it will be a big concern for the industry. We have increased the provision by another ₹33 crore in case some deaths have not been reported to us. Also, given the emergence of the second wave, we decided to be prudent and create a provision of another ₹299 crore. So, as of today, we are carrying a provision of ₹332 crore.

Number of life insurance policies dips in FY21; group covers lead the fall

How many Covid-related claims has the company paid?

We have reported 2,500 lives we had claims on in terms of number of deaths in our portfolio. Net of reinsurance, we had to pay out about ₹264 crore as claims.

ELSS vs ULIP: Which suits you best

What kind of products do you think there will be more demand for?

There has been a lot of demand for protection products and also health insurance products we are allowed to do. There is also momentum in group term insurance. The only caveat is that we are not able to entirely fulfil the entire demand. Given the pandemic one has to be careful about underwriting. Also, for large insurance, we need the support of reinsurers and they are also focussed on proper underwriting. Underwriting standards have become tougher. There is also still a bit of friction in terms of medical examination, which is needed for higher value insurance. This has slowed down the process of issuance. Demand is up but in retail protection there are some supply-side constraints.

ICICI Pru MF launches new fund of funds

Credit life, which is the second segment of protection, had got impacted in the first half but has come back in the second half because banks and NBFCs have started disbursements for retail home loans and other loans. Group term has been a huge opportunity and we had about 100 per cent growth in the segment.

Has there been an impact of the Budget proposal on ULIPs?

As an industry, we have moved away from tax-based selling to goal-based selling. Second, ULIP is a powerful product, allowing customers to take advantage of market movements in a transparent and tax-effective manner. Even in the new regime, customers can invest up to ₹2.5 lakh without tax implications. The new regime was in place from February 1 and there were two full months of this impact. But in our case, ULIP segment has grown 11 per cent year-on-year in the fourth quarter. Empirical evidence of the two months indicates there is no impact at all. As long as long-term investments are on the same platform across mutual funds and insurance, there is nothing to worry.

What is your strategy, going ahead?

Despite the pandemic, we are not changing our strategy to double our value of new business to about ₹2,650 crore by 2023. We will continue to pursue it through the 4Ps of premium growth, protection business growth, persistency improvement and productivity enhancement. Our focus will be on top-line growth. In the fourth quarter, we are firmly back on the growth back and that gives us confidence. We have about 600 new partners and we added seven significant banks last year. On the product side, we have a much diversified product mix. So all this gives us a lot of confidence that we can pursue top-line growth and expand the VNB.

Term insurance rates have been increased by some insurers. Will there be more repricing with the second wave?

The increase in term insurance rates was driven largely by reinsurers increasing the pricing. To the extent of reinsurance pricing, we passed it on in the month of July (last year). We don’t have any proposal to further increase pricing.

We don’t know how the second wave will emerge. We have to wait and see. World over, I don’t think the conclusion has emerged so strongly regarding the lingering or long-term mortality impact of the pandemic.

How do you view the increased FDI limit for the sector?

We wholeheartedly welcome the move as a company and industry. Recently, the draft rules were gazetted, which are reasonable and easy conditions to comply with. Insurance penetration is very low and it being a regulated business there will always be strict capital requirements for the industry and so foreign capital is always welcome. For us, it is a shareholder issue and not a company issue. As an insurance company, we don’t require any capital. We are quite well-capitalised with 217 per cent solvency ratio. We have also increased about ₹1,200 crore of Tier 2 capital.

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Data bank: Setback for the housing sector

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April 26, 2021

 

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April 26, 2021

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HSBC remains bullish on India, to grow local biz, BFSI News, ET BFSI

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MUMBAI: HSBC has retained its growth forecasts for India despite the second wave of Covid and has said that it intends to grow its business in the country. The bank, which has around 39,000 employees here, gets a big chunk of revenue from the country and sees it as the third-largest economy by 2030.

Speaking to TOI, HSBC India CEO Surendra Rosha said, “We do not see short-term challenges with regard to things related to Covid dislocating our strategy.” Even as multinational rivals like Citi have announced their exit from the consumer business in India amid the pandemic, HSBC has said that it is going the other way.

While the bank did rationalise its branch operations in India a few years earlier, which gave an impression of shrinking, the customer base in India has grown. This is because of the shift to digital channels. “A positive development is that adoption of digital has increased and the payoff for investment in digital is much better than it was a few years ago,” Rosha added.

Rosha pointed out that HSBC’s number of customers has increased 37% since December 2017 to 10.5 lakh in December 2020. The bank’s pre-tax profits from India have been over $1 billion for 2019 and 2020. He added that India was among the top three markets for HSBC in 2020 and has always been part of the top five.

HSBC has the advantage of having a strong presence in countries where the Indian diaspora is predominant. This includes the UK, Middle East, Southeast Asia, Australia, Canada and the US. As a result, it has been able to target persons of Indian origin as well as Indians looking to invest in these markets or move there for studies.

While the overall economy has shrunk due to Covid, for a multinational bank like HSBC the opportunities have increased in the last 18 months. This is because of some government measures, which include a reduction in the corporate tax rate, production-linked incentives and the disinvestment plan. All of these provide an opportunity to facilitate inward investment. “Covid is a damper, but India is not an unknown quantity to global corporations. It is about telling them the opportunity in the next few years. So, Covid is not going to be a showstopper for foreign investment,” said Rosha.

Despite the second wave, HSBC research has retained its growth forecast of 11.2% for FY22. “We feel that if there is an impact in the first half of the fiscal, it will be made up in the second half. While the situation is evolving, what we have seen is that with the decline in cases there was a strong pick-up in economic activity,” said Rosha. “So, while we feel that growth will be similar to what the projections are, there will be some adjustment between the first half and the second half,” he added.

As part of its strategy of targeting Indians with an international connection, HSBC provides borderless banking services that allow customers to have a consolidated view of accounts across countries and lets them move money across markets.



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Strategy to ‘conserve, emerge stronger’ helped Karnataka Bank during pandemic: MD

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Karnataka Bank Ltd (KBL) has said that its strategy to ‘conserve, consolidate and emerge stronger’ has done wonders during the Covid pandemic-driven crisis.

In a letter to the shareholders, Mahabaleshwara MS, Managing Director and Chief Executive Officer of KBL, said the resilience of KBL was well exhibited during the pandemic-driven crisis. The Covid-19 business prescription of KBL — ‘conserve, consolidate and emerge stronger’ — has done wonders, he said, adding the bank has been able to contain the expenditure significantly, improve the operational efficiency, realign the credit portfolio by focusing on retail and mid-corporates so as to ensue sustainability, and develop cost-lite deposit portfolio with CASA share of more than 31 per cent, etc.

The digital transactions of the bank stood at an all- time high exceeding 90 per cent. “Now, in terms of our digital capability, we are almost on par with any new generation banks,” he said.

 

Advances

On the advances portfolio realignment strategy, he said the bank has been eyeing to have its credit exposure of minimum of 50 per cent to retail, 35 per cent to mid-corporates and not more than 15 per cent to large corporates so as to minimise the concentration on large corporate borrowers and to ensure continued sustainability.

The bank has been moving towards this direction in a sustainable manner due to the continuous efforts made by it. The yield on the retail and mid-corporate advances has been better than the large corporates, and the risk is wide-spread across the portfolio than that of concentration in the case of large corporate exposure, he said.

Aatma Nirbhar Bharat Abhiyan

Stating that the bank actively participated in the stimulus schemes of the government under the Aatma Nirbhar Bharat Abhiyan, he said it acted swiftly in extending the moratorium benefits, sanctioning of guaranteed emergency credit line loans to the needy and eligible borrowers and also acted quickly on MSME restructuring exercise etc., in a war footing way.

Referring to the Supreme Court order which said that there shall not be any charge of interest on interest / compound interest / penal interest for the period during the moratorium (from March 1 2020 to August 31 2020) on the loans from any of the borrowers even above ₹2 crore, he said the bank had already made ex-gratia payment of difference between compound interest and simple interest for the above six months to the borrowers in specified loan accounts as per the communications received from the Government of India dated October 23 2020 and the RBI Circular dated October 26 2020.

“In the case of remaining accounts, compound interest / penal interest on interest charged on the borrower accounts may have to be refunded and adjusted towards next instalment due within a reasonable time from the date of Supreme Court order dated March 23 2021. Further, with the vacation of Stay Order, NPA marking has also resumed,” he said.

FY 2021-22

For 2021-22, the bank is planning to grow its business at a moderate 12 per cent to take the total business turnover to around ₹1,42,500 crore. With a healthy business growth, ’cost-lite’ liability portfolio, strengthened fundamentals etc., the year 2021-22 should be an ‘Year of Excellence’ for Karnataka Bank, he added.

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How you can insure yourself from Covid

Personal Finance

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With the second wave of Covid raging across the country, many are looking to buy a health cover or enhance the same. According to data from Policybazaar.com, 90 per cent of their customers who have an existing health cover of about ₹5 lakh are porting to a higher sum insured of ₹10-15 lakh. While you must make it a point to follow all Covid protocols to avoid getting infected, here’s how you can financially shield yourself against Covid if you unfortunately fall sick.

 

Date extended for Covid-plans

In addition to taking toll on your health, Covid-19 infection can dent your savings as well.

Keeping this in mind, the insurance regulator, IRDAI has recently extended the validity for sale and renewal of short-term Covid specific health insurance policies – Corona Kavach and Corona Rakshak – till September 30, 2021. This was previously available up to March 31, 2021.

The insurance regulator in July 2020 had mandated that all general and standalone health insurers offer Corona Kavach health policy.

This (Corona Kavach) is an indemnity policy which pays for the hospitalisation of the insured affected due to Covid-19, provided he/she is hospitalised for a minimum period of 24 hours. It also offers cashless facility to its policyholders, provided hospitalisation is from the insurer’s list of network hospitals.

Hospitalisation cover includes expenses such as room rent, boarding, nursing, ICU, ambulance service up to ₹2,000, medical practitioner and consultant fees, operation theatres, PPE kit, gloves, etc.

It covers for home care treatment expenses as well, up to the sum insured (SI) for a maximum period of 14 days. All general and standalone health insurers offer this policy.

There are complaints that some hospitals are not granting cashless facility for treatment of Covid-19 despite policyholders being entitled for the same. The insurance regulator has recently clarified that wherever insurers have an arrangement with the hospitals for providing cashless facility, such hospitals are obligated to provide cashless service for all treatments including treatment for Covid-19. In the event of denial, policyholders can file a complaint with the insurer concerned.

Another plan introduced by IRDAI, but not mandatory to be offered by all insurers, is Corona Rakshak. It is a benefit policy, where the insurer will pay 100 per cent SI upon positive diagnosis and the policy shall terminate thereafter.

As both are standard policies, the coverages and exclusions across insurers will be the same, including the policy name. Both policies can be availed for a period of 105 days (3.5 months), 195 days (6.5 months) and 285 days (9.5 months) and can be renewed to ensure the benefit of the policy continues.

The minimum SI under both policies is ₹50,000; the maximum SI offered under Corona Kavach is ₹5 lakh and for Corona Rakshak ₹2.5 lakh. The minimum and maximum age of entry is 18 and 65 years respectively, and only single premium payment mode is allowed under both policies.

Regular health policies cover hospitalisation due to Corona virus among other diseases/accidents. At the beginning of the outbreak of the pandemic, there were problems over providing cover for associated costs such as personal protection equipment (PPE) kits.

These expenses formed part of consumables which were not usually covered by most insurers. Those who did cover, applied ‘proportionate deduction’ clause based on the type of hospital room availed.

In June last year, to reduce the burden of the policyholders and to standardise the claim settlement, IRDAI, ordered that medical expenses including cost of pharmacy, consumables, implants, medical devices and diagnostics to be covered as part of health policies without being subject to the ‘proportionate deduction’ clause. Covid-related expenses in the above-mentioned heads such as PPE kits will reap the benefit of this move.

Further, if you have a health policy which covers for out-patient (OPD) medical expenses – known as comprehensive cover – you can reimburse your Covid-19 related home treatment medical expenses too, if you are under home quarantine.

Making the choice

Your financial burden is likely to be reduced whether you have Covid-19 specific health covers or a comprehensive health cover. However, if you plan to sign up for one now, do note that all new health insurance policies come with a waiting period of 15 days, only after which your cover will kick in.

Covid specific plans as well as regular health cover have certain exclusions. Any unproven treatment will not be covered.

Coverage under both policies cease if the insured travels (outside the country) to a destination where India restricts travel to or the foreign country restricts entry of travellers from India.

So, if you are looking to buy a plan to protect against Covid, you can skip Corona Kavach if you have a regular health plan covering OPD expenses. Corona Rakshak can be useful if your regular plan does not cover OPD or if you are looking for additional cover. Since Rakshak is a benefit policy, this can come in handy to cover expenses for tests, scans, medicines, etc. for those who are home quarantined.

(This is a free article from the BusinessLine premium Portfolio segment. For more such content, please subscribe to The Hindu BusinessLine online.)

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BoM aims to resolve 20-25 stressed MSME loans under pre-packaged resolution process, BFSI News, ET BFSI

Banking & Finance

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MUMBAI: State-owned Bank of Maharashtra is looking at resolving 20-25 stressed micro, small and medium enterprise (MSME) accounts under the pre-packaged insolvency resolution process, a senior bank official said.

Earlier this month, the government had introduced a pre-packaged insolvency resolution process for stressed MSMEs by amending the insolvency law.

Under a pre-packaged process, main stakeholders such as creditors and shareholders come together to identify a prospective buyer and negotiate a resolution plan before approaching the National Company Law Tribunal (NCLT).

“With the outbreak of the COVID crisis, the stress on hospitality, luxury retail, tour operators, lodging and restaurant operators has increased considerably. I expect around 20-25 stressed MSME accounts to be resolved under the pre-packaged insolvency resolution regime in the coming months,” Bank of Maharashtra’s general manager (credit – large and mid corporate, MSME) Sanjay Rudra said.

He was speaking at a webinar organised by MVIRDC World Trade Center, Mumbai and All India Association of Industries.

He said under the pre-packaged insolvency resolution system, the government has given an opportunity for MSMEs to resolve their stress at an early stage while holding control over their business.

“Now, MSMEs should maintain complete transparency in the whole resolution process to regain trust and confidence of lenders,” Rudra said.

Speaking at the webinar, AZB & Partners cofounder Bahram N Vakil said MSME promoters should file for resolution with the NCLT only after having a robust base plan.

“If the promoters could come out with a resolution plan with a minimum possible haircut for operational creditors and if it is also acceptable to the committee of creditors, then the chances of such plans being challenged in the Swiss challenge auction are less,” he added.

Emphasising that MSME promoters and bankers should work on a reasonable price discovery of the underlying asset, Vakil pointed out that more often, the fair value estimation of the underlying asset is the sore point of litigation among contending parties.



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EPF gets 4.11 crore new subscribers between 2017-21

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More than 4.11 crore new subscribers joined the Employees Provident Fund (EPF) scheme during the last three and a half years, while about 4.87 crore got enrolled in the Employees State Insurance (ESI) scheme, according to the National Statistical Office (NSO).

The NSO said in a release of data of formal employment sectors from 2017 to 2021 that more than 24 lakh people opted for the New Pension Scheme (NPS) of the government in the same period.

In February 2021, around 11.58 lakh new members joined the Employees’ State Insurance Corporation (ESIC). In January this year, about 11.78 lakh joined the scheme from Government and organised sectors of employment. Soon after the first lockdown, in June last year, the ESIC saw about 8.87 lakh new enrollments. It was 4.89 lakh in May and 2.63 lakh in April in the same year during the lockdown period.

But in July, the enrolments came down to 7.63 lakh and later increased to 9.5 lakh in August. 11.58 lakh workers enrolled in September and 12.11 lakh in October 2020.

In the EPFO, 12.37 lakh workers registered in February and 11.95 lakh in January of this year. Between September 2017 to February 2021, the EPFO saw around 4.11 crore new subscribers. In the NPS, 58,250 joined in February 2021. The scheme has 64,40,628 subscribers as of now.

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Small finance banks see loan collections drop as Covid rages, BFSI News, ET BFSI

Banking & Finance

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With the Covid pandemic spreading fast into the hinterland, small finance banks are feeling the heat.

The second Covid wave is resulting in a delay in collections this month, though banks are much prepared than last time when they were caught unawares by the pandemic.

The impact is more in smaller towns rather than the rural areas which have seen good monsoon. Also, several bank employees are down with Covid, hampering collection efforts.

As per a report by Emkay Global, the first fortnight of April 2021 has been weak in terms of business activity which is down by 20% across various segments due to lower working days and onset of an aggressive second wave of Covid-19 infections. This is expected to fall further with far stricter enforcement of localised lockdowns.

Cautious lenders

According to experts, credit appetite is likely to remain intact but lenders may turn cautious, which could hurt growth in the near term.

The collection efficiencies were improving from August-September onwards on a month-on-month basis across asset classes. However, a year back, the restrictions announced so far are lower in trajectory or intensity. So while there will be an impact on collections and delinquencies, the impact should be lower than what we saw in Q1 of last year.

But if there was a rise in the intensity of cases accompanied by containment measures and restrictions, it could further impact collections.

The spread intensity and duration of the pandemic, how long the lockdown and curbs last and vaccine trajectory will decide the severity of hit to the SFBs.

Microfinance hit

The mainstay of small finance banks, the microfinance loans are likely to face asset quality pressures in the near term due to the recent surge in Covid infections.

However, a majority of microfinance institutions (MFIs) will be able to withstand any stress due to their improving collection efficiency and good on-balance sheet liquidity, Icra Ratings said.

“We estimate asset quality pressures for the MFI industry to continue in the near term and the same may get accentuated with the recent increase in Covid-19 infections and localised restrictions/lockdowns,” the agency’s Vice President and Sector Head (financial sector ratings) Sachin Sachdeva said.

The agency noted that even though the near-term outlook for MFIs is clouded given the Covid induced disruptions, the overall long-term growth outlook for the domestic microfinance industry, including MFIs and micro finance-focused small finance banks (SFBs), remains robust.

The collection efficiency (total collections/scheduled demand) of the sector improved to around 102 per cent in December 2020.

The disbursements also started picking up from Q2 FY2021 onwards, which is expected to help the MFI industry achieve growth of 9-11 per cent in its assets under management (AUM) in FY2021, it said.

Collection efficiency

Sachdeva said the improvement in collection efficiency and pickup in growth in AUM in H2 FY2021 has helped the industry witness marginal improvement in the overdue portfolio (0+ days past due (dpd)) to 16.7 per cent as on December 31, 2020, which had earlier increased to 18.1 per cent as on September 30, 2020 after the lifting of the moratorium.

There has been further improvement in Q4 FY2021 as well. However, overdues remain significantly higher than pre-Covid levels, he said.

“We estimate the credit costs to rise significantly to 6-7 per cent (spread over two years: FY2021-FY2022) from 1.5 per cent in FY2020, he said.



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Banks tag more borrowers as wilful defaulters during IBC suspension, BFSI News, ET BFSI

Banking & Finance

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Banks slapped more borrowers with a wilful defaulter tag during April-December 2020 when the Insolvency and Bankruptcy Code was under suspension.

They classified loans of over Rs 28000 as wilful defaults during the first nine months of last fiscal as against around Rs 23,000 a year ago, according to a report.

A borrower is labelled wilful defaulter if the loans is not repaid despite having the means to repay or it is diverted for use other than the purpose.

A wilful defaulter tag borrower then faces a ban on bank funding the total outstanding wilful default as of December 31 at Rs 2.4 lakh crore with State Bank of India accounting for Rs 62,000 crore, of which Rs 18,000 crore were added in the first nine months of the last fiscal, according to data from credit bureau TransUnion Cibil.

The largest share of wilful defaulters is Maharashtra at over Rs 80,000 crore, followed by Delhi at Rs 32,000 crore and West Bengal at Rs 23,000 crore.

Fearing investigations, audit and vigilance inquiries, bankers generally do not want to opt for resolution and go for full recovery from the defaulter.

Top borrowers

The country’s top 100 wilful defaulters owe Rs 84,632 crore to banks as of March 2020, with the top 10 including, Winsome Diamonds & Jewellery and accounting for 32% of it, data from the Reserve Bank of India shows.

Banks tag more borrowers as wilful defaulters during IBC suspension

While banks wrote off nearly three-fourth of it to clean their balance sheet and get tax benefits, the default borrowers continue to appear in RBI’s internal CRILC database till they clear the default.
The total size of the top 100 wilful defaults rose 5.34% in FY20 from Rs 80,344 crore as of March 2019, according to data shared by RBI in response to an application under the Right to Information (RTI) Act.

Mehul Choksi-owned Gitanjali Gems topped the wilful defaulters’ list with Rs 5,693 crore dues, followed by Jhunjhunwala brothers’ REI Agro with Rs 4,403 crore and Jatin Mehta’s Winsome Diamonds & Jewellery with Rs 3,375 crore.

The top 10 wilful defaulters include another jewellery maker Forever Precious Jewellery, and Vijay Mallya’s Kingsher Airlines.

The stack-up

Punjab National Bank had the highest exposure to Gitanjali Gems with Rs 4,644 crore of non-performing assets (NPA) as on March 2020.

PNB also had Rs 1,447 crore exposure to Gili India and Rs 1,109 crore to Nakshatra Brands.

State Bank of India had Rs 1,875 crore dues from top 10 wilful defaulter ABG Shipyard with the bank writing o the entire amount. Uco Bank had Rs 1,970 crore exposure to REI Agro with half of it being written off.

Write-offs are accounting entries for shifting NPAs from the active balance sheet to off-balance-sheet accounts. These are backed by 100% provision and therefore any recovery from these accounts adds to net profit.

RBI collects credit data from banks monthly, with data on defaults being collected on a weekly basis. The regulator has mandated banks to provide fully against NPAs older than four years and allowed to write these old NPAs.

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