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No tolerance for bad loan recovery, particularly from big defaulters:Nirmala Sitharaman

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8 months ago

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New Delhi: The Enforcement Directorate (ED) has so far attached assets worth Rs. 64,920 crore from 1,105 such defaulters under its scrutiny, according to Finance Minister Nirmala Sitharaman, who stated on Friday that there has been “no leniency” in recovering bad loans from huge defaulters and that the process is ongoing.

The Finance Minister denied the Opposition’s allegation that loans to industrialists were waived under the Modi administration in a series of tweets on X.

The Opposition, which is accustomed to disseminating false information, falsely asserts that industrialists have had their loans “waiver”ed. It’s unfortunate that opposition leaders still can’t tell the difference between write-offs and waivers, even if they consider themselves to be “experts” in banking and the economy. Following the “write-offs” in accordance with RBI norms, banks actively work to recover non-performing loans. Furthermore, no industrialist’s debts have been “waiver”. Banks recovered more over Rs. 10 lakh crore from bad loans between 2014 and 2023, according to Sitharaman.

Approximately 1,105 bank fraud cases have been examined by the ED, and as a result, criminal proceeds totaling Rs. 64,920 crore have been attached. According to her, assets totaling Rs. 15,183 crore had been returned to Public Sector Banks (PSBs) as of December 2023. “The process of recovering bad loans is ongoing and has not been lenient, particularly with regard to large defaulters.”

She said that the balance sheets of both banks and corporations were under stress as a result of the previous administration’s abuse of the banking industry to benefit “cronies” through reckless lending and concealing real non-performing assets (NPAs). “Banks are no longer “NPA-laden nightmares”; instead, they are now “Pillars of Jan Kalyan.” We no longer have a “Twin Balance Sheet Problem,” but rather a “Twin Balance Sheet Advantage,” the speaker continued.

“Our government and the Reserve Bank of India (RBI) implemented a number of measures, such the Asset Quality Review (AQR), that exposed hidden mountains of non-performing assets (NPAs) and stopped the use of accounting gimmicks to conceal them. The shameful legacy of the “Twin Balance Sheet” situation, which we inherited in 2014, was caused by reckless and imprudent loans during the Congress era, according to the finance minister.

According to her, getting bank loans during the United Progressive Alliance (UPA) administration frequently hinged more on strong contacts than a strong business plan. Before authorising these loans, “banks were forced to neglect proper due diligence and risk assessment,” the accuser stated.

According to her, the gross non-performing assets (NPAs) of PSB reached a peak of 14.6% in 2017–18, after banks’ full disclosure of their NPAs for loans made prior to 2014.

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She cited the opinions of former RBI governors Urjit Patel and Raghuram Rajan, who have expressed disapproval of the current administration, and claimed that the two leading figures in the Indian banking sector had also brought up the NPA crisis that the UPA regime had caused and had “openly exposed” the extent of the system’s degradation left by the previous administration.

Rajan, who took part in the ‘Bharat Jodo Yatra’ organised by @RahulGandhi, called the NPA crisis of the UPA era a ‘historic phenomena of irrational exuberance.’ Sitharaman quoted Patel as saying that PSB operations under the UPA experienced “a perennial shortcoming on account of bureaucratic inertia and political meddling.”

In order to curb the evergreening of bad loans and uncover hidden NPAs, the RBI launched a comprehensive AQR in 2015 under the leadership of Prime Minister Narendra Modi. By March 2018, total NPAs had increased to Rs. 10,36,187 crore.

Because evergreening caused the majority of NPAs to be concealed on bank balance sheets, the gross nonperforming assets (NPAs) as of March 31, 2014, was Rs. 2,16,739 crore prior to the AQR. In order to restore the health of the banks, the government subsequently implemented a four-point plan known as recognition, resolution, recapitalization, and reforms. Even though banks were recapitalized for Rs. 3.10 lakh crore, as of March 2024, other reforms including the Insolvency and Bankruptcy Code (IBC) had addressed loans totaling more than ₹3.36 lakh crore.

“We tackled responsible lending, stress recognition and resolution, credit discipline, and enhanced governance through our reforms. Professional integrity and independence have taken the role of political meddling in banks. According to Sitharaman, the Banks Board Bureau (BBB) was established to facilitate an open process for choosing non-executive chairpersons and full-time directors.

“Our government issued a framework for the timely detection and investigation relating to large value bank frauds in 2015,” the speaker stated, providing specifics about the reforms made to the banking sector. For quicker recoveries, the Insolvency & Bankruptcy Code was introduced. Property belonging to fugitive economic offenders may be seized under the Fugitive Economic Offenders Act of 2018. The SARFAESI Act was modified to increase its efficacy. Banks have recovered ₹1.51 lakh crores through SARFAESI during the past five years.

The creation of stressed asset management verticals by PSBs for strict recovery, the separation of monitoring from sanctioning roles in high-value loans, the deployment of specialised monitoring agencies for effective monitoring of loans above ₹250 crore, and online end-to-end one-time settlement (OTS) platforms to ensure timely and better realisation were among the measures that helped strengthen banks.

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Sports

Lionel Messi’s final jab at Cristiano in a million-dollar text message for Lyon’s Argentina player: “Don’t listen to Ronaldo”

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6 days ago

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January 16, 2025

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French club Lyon stoked the flames of the Ronaldo-Messi rivalry in their announcement video for Argentine midfielder Thiago Almada.

With the January football transfer window currently open and clubs across Europe looking to add talent to their rosters for the run-in in the second half of the season, French team Olympique Lyonnais have made the exciting signing of Argentine midfielder Thiago Almada. Almada joins on an initial loan from Brazilian club Botafogo, but his announcement was made in style in the latest in a long line of iconic transfer videos.

The 23-year-old midfielder’s signing was announced through a video shared by Lyon in which he receives a text message from ‘Lionel’ along with a goat emoji, clearly meant to be the legendary Lionel Messi, Almada’s compatriot and teammate in the Argentine national team. The text sent to Almada in this video reads “Don’t listen to Cristiano, Ligue 1 is incredible.”

Lyon’s retribution for Ronaldo’s comments
The text provides a sneaky tongue-in-cheek remark from the seven-time French champions, who are referencing Cristiano Ronaldo’s past comment regarding Ligue 1 being a weaker competition than the Saudi Pro League, where he currently plies his trade for Al Nassr. Ronaldo had claimed there was a better standard of football in Saudi Arabia, with the French league considered the weakest of the ‘top five’ leagues in Europe.

Messi, meanwhile, spent two years playing in France, having spent a period in the capital with Paris Saint-Germain after leaving Barcelona. Messi was the latest star at PSG, playing alongside Neymar Jr and Kylian Mbappe, before the trio was broken up as they left France with Messi heading to Inter Miami, Neymar to Al Hilal in Saudi Arabia, and Mbappe finally getting his marquee move to Real Madrid.

Almada was part of the Argentina squad that lifted the World Cup trophy in Qatar in 2022, helping Messi finally get his hands on the coveted trophy and firmly setting his status as the greatest of all time in stone. Almada has represented Argentina six times, scoring twice, and finally earned a move to Europe after playing for Atlanta United in the MLS and a brief spell in the Brazilian Serie A at Botafogo. Almada will be joining fellow Argentine Nicolas Tagliafico, who also made a cameo appearance in the announcement video.

Lyon currently sit in sixth place in the Ligue 1 table with half the season concluded, but will have intentions of fighting for spots in next year’s UEFA Champions League with a strong end to the season, in which Almada could play an important role.

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India

India applauds Israel and Hamas’ ceasefire agreement.

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6 days ago

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January 16, 2025

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The conflict was triggered by Hamas’s brazen terror attacks on southern Israel on October 7, 2023 that killed almost 1,200 people

India on Thursday welcomed the ceasefire deal reached between Israel and Hamas and reiterated its call for a return to a path of dialogue and diplomacy.

Negotiators from Israel and Hamas have agreed on a 42-day truce and hostage release, and the deal will come into effect on January 19, US President Joe Biden and Qatari Prime Minister Mohammed bin Abdulrahman bin Jassim Al Thani said on Wednesday. The truce comes after more than 460 days of war that has devastated Gaza.

“We welcome the announcement of the agreement for the release of hostages and a ceasefire in Gaza,” the external affairs ministry said in a brief statement.

“We hope this will lead to a safe and sustained supply of humanitarian assistance to the people of Gaza. We have consistently called for release of all hostages, ceasefire, and return to a path of dialogue and diplomacy,” the statement said.

The conflict was triggered by Hamas’s brazen terror attacks on southern Israel on October 7, 2023 that killed almost 1,200 people. More than 46,000 Palestinians have been killed in Israel’s retaliatory attacks and bombardment of the Gaza Strip.

Qatar’s prime minister told reporters that Israel and Hamas were still to conclude some logistical matters related to the ceasefire, while the office of the Israeli prime minister said in a statement that a number of details of the agreement remained unresolved. The deal also needs to be formally ratified by the Israeli cabinet and the government.

The initial phase of the ceasefire, set to last six weeks, will see a limited prisoner exchange, partial withdrawal of Israeli troops from Gaza and a surge of aid into the region. Thirty-three Israeli nationals taken hostage during the October 7 attacks will be released in exchange for a large number of Palestinian prisoners, according to reports.

Around 100 Israeli hostages are thought to be still in Gaza, though Israeli authorities believe some if them are dead.

India initially expressed solidarity with Israel after the attacks by Hamas, in line with its “zero tolerance” policy on terrorism, but it adopted a more nuanced position subsequently because of concerns expressed by Arab partners.

India has strong strategic ties with Israel while Arab states are key sources of energy and have developed stronger defence and security ties with India in the past decade. India also had significant concerns about the potential expansion of the conflict because West Asia is home to nine million Indians, with almost six million of them concentrated in Saudi Arabia and the United Arab Emirates.

As the war dragged on, India repeatedly urged Israel to be mindful of humanitarian concerns in its response. The Indian side also called for the unimpeded provision of humanitarian aid to the people of Gaza and a return to the path of dialogue and diplomacy aimed at finding a two-state solution.

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World

Pricey’ private security business hired by Secret Service for high-profile events during Trump’s Inauguration

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6 days ago

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January 16, 2025

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Donald Trump will be inaugurated as the 47th President on January 20th, with heightened security measures following assassination attempts.

Donald Trump is set to be inaugurated as the 47th President of the United States on January 20th. Preparations for the momentous day are already underway, with a particular focus on security, especially following two assassination attempts on the incoming president during his political campaign.

Trump’s inauguration ceremony will be reportedly secured by a private security company, with significant costs borne by the government to ensure the safety of the incoming president.

Trump inauguration event hires private security firm
TMZ has obtained federal procurement documents revealing that the Secret Service has hired Arcus Group LLC, a private security company, to help with the upcoming inauguration. The event which will kick off with a service at St. John’s Church, a historic Washington DC church, followed by tea at the White House is set to welcome several high-profile figures including former US Presidents and First Ladies.

This company as per the data has secured an $8.1 million contract for the task, primarily focused on securing the event’s perimeter.

Who is Arcus Group?
Arcus Group specialises in providing temporary security perimeters for high-profile events, which is why they’ve been selected for Trump’s inauguration. Their services include setting up security barriers, anti-scale fencing, barricades, and even mobile command posts.

According to their website, their “security services include a complete threat assessment to ensure attendee safety.” For all event sizes, they prioritise “crowd control and provide 8’ – 12’ anti-scale fences or bike rack barriers. Our team can assist you in selecting the most appropriate security setup.”

The costs of private security have risen, with the Secret Service spending $7.5 million for Joe Biden’s inauguration. Meanwhile, apart from Trump and his wife Melania, other prominent figures like incoming Vice President JD Vance, former President George W. Bush, Bill and Barack Obama alongside Joe and Jill Biden, former First Lady Hillary Clinton are expected to attend Trump’s inauguration.

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