Andhra Bank seems to have taken an interesting choice in trying to cut down NPAs. They have been holding “dharnas” in front of defaulters’ offices, hoping to shame them into paying at least the outstanding amounts so they move out of being NPAs. Hans India reports that bank employees are standing in front of Dhruv Medical Center, in Hyderabad, which owes them Rs. 6 cr.
(pic from Hans)
6 cr. is tiny, but 227 cr. is bigger, and Agri Gold owes them that much – the Hindu reports they were there too. There’s even more from the Indian Express and from Business Standard.
Andhra Bank, unfortunately has this mega problem of bad loans inching up to be more than 6% of advances.
And they have a massive problem coming up: the Bhushan Steel loan that’s likely to turn NPA soon. That is a whopping Rs. 1500 cr. loan, it seems! (Sure, they have assets, but they also have 36,000 cr. of total loans – it’s not apparent who gets how much of whatever is left)
Every bank is going to be jittery, and markets might have a small sense of this. Watch this space.
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