United Bank tops list with highest bad loans among PSU lenders

New Delhi: United Bank of India has topped the list of public sector lenders with maximum bad loans including restructured assets as a percentage of total advances.  According to the data provided by the RBI to the Finance  Ministry, United Bank of India's 21.5 per cent assets are  either bad or have been restructured to save them from turning  non-performing assets (NPAs). The other banks that have significant amount of gross  NPAs and restructured loans include, Central Bank of India  (21.30 per cent), Indian Overseas Bank (19.40 per cent),  Punjab & Sind Bank (18.74 per cent) and Punjab National Bank  with 17.94 per cent as on March 2015.  State Bank of Patiala, Allahabad Bank, Oriental Bank of  Commerce, UCO Bank and Dena Bank all have bad and restructured  loans in excess of 15 per cent. 

The rising bad loans have been a major concern for the Reserve Bank as well as the government and steps are being  taken to deal with it.  Most of the restructured loans are from the corporate  sector. The top-30 defaulters are sitting on bad loans of Rs  93,769 crore, which is more than one-third of the gross  non-performing assets of PSU banks at Rs 2,55,180 crore as on  March 2015. 

There are four kinds of restructuring. The first and  foremost is restructuring of advances extended to industrial  units, restructuring under Corporate Debt Restructuring and  restructuring of loans extended to MSME as per RBI guidelines. However, banks have their own operational rule for  restructuring of small loans.The RBI has not prescribed any board or bank level  position at which these loans need to be approved.