As the Kingfisher House of Vijay Mallya goes under hammer in Mumbai one is made to think as to how can nationalised bank have wilful defaulter. As per the bank when a borrower does not repay the loan despite having capability to repay are called wilful defaulters.
According to the Credit Information Bureau (India) Ltd (CIBIL), a company set up by banks to collect defaulter information there are 5,275 other wilful defaulters who collectively owe various public sector banks more than Rs. 56,000 crore.
CIBIL's another shocking revelation is that this money has grown nine-fold during last 13 years. In 2002 wilful defaulters owed Rs. 6,291 crore to the banks whereas in 2015 they owed Rs. 56,521 crore.
The sum of Rs. 56,000 crore that the defaulters owe to bank is 1.5 times more than what the union government has proposed to spend on agriculture and farmers' welfare.
As per S Nagarajan who is General Secretary of All India Bank Officers' Associations a powerful nexus between chairmen of public sector banks, auditors, RBI and the banks' boards is the main reason behind the ever increasing bad loans of wilful defaulters of the public sector banks.
CIBIL's list of wilful defaulters:
As per CIBIL Dr. Vijay Mallya owes Rs. 1,201.4 crore to State Bank of India making him a wilful defaulter who owes such a huge sum to a single bank. Deepak K Baweja of Beta Naphthol owes Rs. 951.91 crore to Kotak Mahindra bank. Winsome Diamonds and Jewellery Ltd. owes Rs. 900.37 crore to Punjab National Bank. Zoom Developers Pvt Ltd too owes thousands of crore to Punjab National Bank, Indian bank, Union Bank of India, State Bank of Hyderabad and State Bank of India.
Top 10 wilful defaulters as per the CIBIL are: Winsome Diamonds and Jewellery Ltd and Forever Precious Jewellery and Diamonds Ltd.; Zoom Developers Pvt Ltd. Kingfisher Airlines Ltd.; Beta Naphthol; Raza Textiles Ltd.; Rank Industries Ltd.; XL Energy Ltd.; Deccan Chronicle Holdings Ltd.; Electrotherm (India) Ltd.; and Zylog System Ltd.
Other interesting pointers about wilful defaulters:
Maharashtra state has more number of wilful defaulters than any other state, followed by West Bengal and Andhra Pradesh.
If we go by the amount owed to bank Maharashtra still tops the list with Rs. 21,647 crore as bad loans followed by Delhi with Rs. 7,299 crore of bad loans.
There are 19 nationalised banks that have 4,738 wilful defaulters. SBI and associated bank account for 1,546 wilful defaulters from those listed.
Among the wilful defaulters is Deccan Chronicle the English daily which has used its unpaid loans for other businesses like buying an IPL cricket team.
JB Diamonds which owes around Rs. 500 crore to Hong Kong banks has been accused by the bank of well-planned fraudulent transactions.
CIBIL data doesn't list all wilful defaulters:
Apart from CIBIL there are three other Credit Information Companies (CICs) that collect and maintain data of all those wilful defaulters who owe Rs. 25 lakh or more. The three other CICs are: Equifax, Experian and CRIF.
RBI only has the complete list of all defaulters. However, the bank doesn't reveal the names of the defaulters. The list that RBI has contains the names of those borrowers too against whom no legal action has as yet been initiated by the lending bank.
As per the CIBIL list over and above the wilful defaulters there are 7,436 other defaulters who owe various banks Rs. 115,301 crore ($17.47 billion).