Amidst severe criticism about the increasing bad loans of PSU Banks, SBI has sold Rs. 3,590 crores NPA (Non-Performing Assets – bad loans) to Asset Reconstruction Companies (ARC). These include mainly security bonds as also a small part of about Rs. 241 crores. Another Rs. 1,892 crores loans have been written off.

There are certain important issues connected with the NPA or bad loans. Most of the NPA are due from corporates and big business. it can be said that there are very few companies including the big corporates who are not in the list of defaulters. No serious action is taken by the banks for collection of the same and later they are written off. But the banks are very strict with the small creditors from whom they collect the loans with mighty efficiency. Of course the banks may be reluctant to annoy the big guns. Secondly they may have illegal connections with the big corporates in one way or other.

The Bank Employees’ Associations and Unions have been focussing these points and demanding the managements to strictly collect the loans from the biggies.