The Andhra Bank (AB) has launched a one time settlement camp to bring down the Non-Performing Assets (NPAs) of small value. The bank has decided to waive off 55 per cent to 30 per cent of default amount for the NPAs. The waiver will depend upon the age of NPAs.
Speaking to The Hindu , Andhra Bank Circle General Manager (CGM) Ajay Gupta said that the bank worked out a few formulae for the settlement. The borrower will have to pay 70 per cent of accounts up to Rs. 10 lakh. These accounts should have been declared as NPAs from April 1, 2013 to March 31, 2014. Likewise, 60 per cent of amount in default would be collected if the NPA was between April 1, 2011 and March 31, 2013; 50 per cent of amount in default would have to be paid by the borrower if the NPA was April 1, 2009 and March 31, 2011. The borrower need to pay 45 per cent of the amount in default if the NPA was on or before March 31, 2009, he said.
Mr. Gupta said that substandard accounts and accounts eligible under the debt waiver scheme were not eligible for the OTS. The accounts involving cases of fraud would be considered only after obtaining administrative clearances from the Vigilance Department. Borrower having multiple accounts or credit facilities in the same capacity was also eligible if the aggregate real account outstanding was not above Rs. 10 lakh, he said.
The gross NPAs of Vijayawada Circle of Andhra Bank as on March 31, 2015 were 5.38 per cent of gross Advances. The bank has plans to bring it down to 4 per cent by recovery and compromise settlements. The bank would implement SARFAESI Act (The Securitization and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002) if the borrowers didn’t respond to the OTS scheme and settle the accounts, he said.
