ECONOMYNEXT – Sri Lanka’s state-run Peoples’ Banks says non performing loans of the bank which are classified based on central bank rules on delayed payments go through a negotiation and recovery process and are not written off.
The bank said some of the loans date back over two decades.
The full statement is reproduced below:
In view of the recent discussions in several public forums relating to the Non Performing Assets (‘NPA’) portfolio of People’s Bank, the Bank wishes to set out the following matters of fact:
• NPAs are loans whose interest and/ or principal have not been duly serviced for a
stipulated time period. A mere classification to NPA does not constitute a write off.
• If/ when a facility is classified as NPA, the Bank commences its due process to recover
which includes actions such as follow ups, negotiations, auctioning and litigation.
In this context, the following points are emphasized for better understanding;
a. A write off is undertaken only if and after every other avenue for recovery is
b. The Bank’s portfolio of NPAs consists of those originating/ having been so classified during a period of over two decades.
c. None of the loans discussed recently in public forums have been written off.
• People’s Bank’s NPA portfolio compares well with industry averages.
• As a responsible Financial Services Provider which provides unparalleled security for
customer deposits, People’s Bank considers recovery of NPAs as a matter of utmost