No impact of 2G licence cancellation on PSU banks: FinMin
The Finance Ministry Tuesday said the Supreme Court's decision to cancel 122 telecom licences should not have any impact on the public sector banks.
New Delhi: The Finance Ministry Tuesday said the Supreme Court's decision to cancel 122 telecom licences should not have any impact on the public sector banks.
"The cancelled licences represent certain circles or areas only. Therefore, the cancellation of licences should not have any material impact on public sector banks," Minister of State for Finance Namo Narain Meena said in a written reply to the Rajya Sabha.
He said most of the loans were regular as on February 1, 2012, and "secured in the form of various tangible and other securities."
"Banks have not urged the government to compensate the losses," Meena added.
The apex court had last month cancelled 122 2G spectrum licences granted by former Telecom Minister A Raja on the ground that they were issued in a "totally arbitrary and unconstitutional" manner.
According to a report by global rating agency Fitch, the Supreme Court's decision will hit the profitability of banks that had extended credit to these companies by up to 10 percent.