New Delhi: Finance Minister Arun Jaitley on Monday met the heads of PSU banks to discuss the issue of non-performing assets (NPAs) and the steps being taken by them to expedite the recovery of bad loans which have crossed Rs 6 lakh crore.


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Besides, he also reviewed the financial performance of all the public sector banks (PSBs) at the meeting, the first between Jaitley and them in the current fiscal.


“NPA resolution, finances of banks, review of financial inclusion discussed with heads of public banks,” Jaitley said.


“PSBs made stable operating profit of Rs 1.5 lakh crore in 2016-17, net profit at Rs 574 crore after provisioning,” he added.


Stating that there is a challenge on credit growth, Jaitley said that speedy resolution for all pending NPA cases are required.


"States which want to go in for farm loan waiver will have to generate funds from their own resources," Jaitley said on loan waiver by Maharashtra.


As for the recovery of bad loans, the RBI has also made substantial changes in the related norms and warned banks of monetary penalty for missing NPA resolution timelines.


Jaitley had said the ordinance empowered the Reserve Bank to issue "directions to any banking company or banking companies to initiate insolvency resolution process in respect of a default under the provisions of the Insolvency and Bankruptcy Code (IBC), 2016".


Toxic loans of PSBs rose by over Rs 1 lakh crore to Rs 6.06 lakh crore during April-December 2016-17.


Gross NPAs of PSBs nearly doubled to Rs 5.02 lakh crore at the end of March 2016, from Rs 2.67 lakh crore at the end of March 2015.


With PTI Inputs