Parliament’s Standing Committee on Finance raised concerns about “stagnation in lending operations” of State-owned banks during a meeting with representatives of 11 public sector banks on Tuesday.
The 11 banks are under the RBI's watchlist for mounting bad loans.
According to sources, representatives of the banks told the panel, headed by Congress leader M. Veerappa Moily, that by 2020 they would be in a more stable condition.
The banking sector is grappling with rising NPAs, which touched ₹8.99 lakh crore or 10.11% of total advances at the end of December 2017. Of the total gross NPAs, public sector banks accounted for ₹7.77 lakh crore.
Rising frauds
The number of frauds reported by banks increased from 4,693 in 2015-16 to 5,904 in 2017-18. The fraud amount at end-March 2018 was ₹32,361.27 crore, up from ₹18,698.8 crore at the end of 2015-16.
The Standing Committee is in the process of wrapping up its report before the monsoon session begins next month.