New Delhi, June 12 (IANS) Finance Minister Pranab Mukherjee Tuesday asked banks to reduce non-performing assets (NPAs) for the financial health of the sector.
"I am happy that banks have taken up the challenge to reduce NPAs and made a record recovery against prudential write-off in the last quarter ending March 2012... I urge you to deploy various tools at your command for containing and rolling back NPAs in accordance with the guidelines of the Reserve Bank of India," Mukherjee said during a meeting here with chief executive officers of public sector banks and financial institutions.
There has been reduction in gross NPAs from the level of 3.18 percent in December 2011 to 3.10 percent in March 2012.
Mukherjee said the recent decisions on restructuring of loans in the textile sector and power distribution companies were good examples of NPA management.
The finance minister congratulated all the public sector banks on achieving a healthy growth in both deposits and advances.
The deposits have grown 14.4 percent and now aggregates to over Rs.50 lakh crore, as compared to last year. The advances have grown 17.7 percent over last year and now aggregates close to Rs.40 lakh crore.
Net profits of public sector banks have also gone up from Rs.44,900 crore to over Rs.49,500 crore in 2011-12 despite a difficult economic scenario.