Public sector banks have written off loans worth Rs 6.1 lakh crore in the last five financial years and the first half of the current fiscal year, the Union Ministry of Finance told Parliament on Tuesday.

Writing off a bad loan allows a bank to move a non-performing asset out of the assets side in its books and list it as a loss. This helps the bank reduce the number of its non-performing assets and lowers its tax burden, as the amount written off is not classified as profit.

The ministry said that there has been no capital infusion by the Union government into public sector banks since the financial year 2022-’23. “Public sector banks have improved their financial performance, turning profitable and strengthening their capital position,” it added.

The Union government said that the p

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