New Delhi, Mar 22: Finance Minister P Chidambaram today said the circular issued by the State Bank of India (SBI) relating to stopping of loans for purchase of tractors and other farm equipment has been withdrawn as it was "poorly worded and misunderstood." "The matter stands closed," Mr Chidambaram told reporters here.
The Finance Minister said he had advised the largest bank of the country to withdraw the circular as it was "poorly worded and was being misunderstood" Reports quoted the circular asking the Bank's branches to stop giving loans for the pruchase of tractors and other farm equipment.
The reason for this was the mounting Non-Performing Assets (NPAs) in the farm equipment loan segment. Mr Chidambaram said NPAs were a normal part of any banking activity. He said the concerned Secretary had spoken to the SBI top brass about the drafting of the circular.