Bank of Maharashtra Has ‘Written Off’ Over ₹7,000 Crore in Loans Between 2011-20

Bank of Maharashtra Has ‘Written Off’ Over ₹7,000 Crore in Loans Between 2011-20

It has come to light that the Bank of Maharashtra (BoM) has written off more than ₹7,000 crores to loan defaulters over the past few years. The broader data between 2011 and 2020 were accessed and uncovered by The Indian Express. In its defence, the bank has said that the loan wasn’t waived off permanently. 

An activist and shareholder of the bank, Vivek Velenkar said that the information about waiving off defaulters’ loans is coming up for the very first time. “I had sought information regarding the amount written off by the bank in the last four years. The bank has given me a written reply stating that Rs 7,000 crore defaulters’ money has been technically written off,” he added.

As per the uncovered data, a total of ₹7,400 crores had been written off between the 2011-2020 timeframe. A majority of these write-offs, amounting to around ₹7,000 crores, occurred in the last four years, it is said.

Velenkar added that the BoM told him that the ₹7,000 crore consists of defaulters who owe more than Rs 100 crore. “I had sought to know from the bank about defaulters who owe more than Rs 100 crore to the bank. The bank refused to provide the information. It has written to me that such information cannot be disclosed as it is of confidential nature,” he added.

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He also mentioned that State Bank of India (SBI) had managed to provide details of defaulters over Rs 100 crore. Velenkar questioned the difference between the two banks despite the fact that they’re both public sector undertakings. 

Providing a clarification, Bank of Maharashtra said that the amount had been “technically written off”, which apparently means that the amount will be recovered at a later date. However, no additional clarification was provided.

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The bank also said that providing information about defaulters of over Rs 100 crore is not possible as it is covered by the confidentiality clause. The bank added that it wasn’t offering preferential treatment to any of the defaulters and that it will recover the pending loans.

Velenkar mentioned that even if the bank claims that it will collect the pending loans at a later date, the recovery process is very slow. He added that Bank of Maharashtra only managed to recover around Rs 253 crore between 2011 and 2020. 

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