RTI response reveals large loan write-offs, recoveries and ₹7,817 crore in settlement haircuts
New Delhi: State owned Bank of Baroda (BoB) has technically written off ₹35,715 crore in loans involving accounts with outstanding dues of ₹100 crore or more over six financial years, from FY2020-21 to FY2025-26, according to information provided under the Right to Information (RTI) Act.
The bank reported ₹9,946 crore in recoveries from these large accounts during the same period around 28% of the amount technically written off.
What does “Technical write off” mean?
A technical write off is primarily an accounting treatment. It means the loan is removed from the bank’s books for accounting purposes.
It does not automatically mean that the borrower has been forgiven the debt or that the bank has stopped trying to recover the money. Recovery proceedings can continue even after a technical write off.
Largest write offs came in FY2020-21 and FY2021-22
According to the RTI response, the largest technical write offs were:
- FY2020-21: ₹11,916 crore
- FY2021-22: ₹11,261 crore
- FY2022-23: ₹8,733 crore
- FY2023-24: ₹2,055 crore
- FY2024-25: ₹1,750 crore
- FY2025-26: No technical write off reported in the disclosed figures
Together, these amount to ₹35,715 crore.
₹7,817 crore in settlement haircuts
- The bank also reported ₹7,817 crore in haircuts associated with settlements of large loan accounts during the same six year period.
- The largest amount was reported in FY2021-22 at ₹3,132 crore, followed by ₹2,331 crore in FY2020-21 and ₹1,831 crore in FY2022-23.
- A “Haircut” generally means the lender accepts less than the amount originally owed in order to settle a loan.
Bank refuses to disclose borrowers’ names
- One of the major issues raised by the RTI response is that Bank of Baroda did not disclose the names of the large borrowers behind the write offs and settlements.
- The bank cited exemptions under the RTI Act, including provisions relating to personal information and third-party information.
- The RTI application was filed by Pune based activist Vivek Velankar.
Questions over recovery and transparency
- The figures have raised questions about how effectively large loans are being recovered and how much money banks ultimately recover after technical write offs and settlements.
- However, the figures do not by themselves prove that the borrowers were wilful defaulters or that any bank official acted improperly. Those conclusions would require separate evidence or investigation.
- The key public interest question is therefore not simply “Where did ₹35,715 crore go?”
It is:
How much of this money can still be recovered, why did such large loans become stressed, and who is accountable for ensuring that recovery efforts continue?
What this means for the public
- The disclosure highlights the enormous scale of large-value bad loans handled by a major public-sector bank.
- A technical write off may clean up a bank’s books, but the real test is recovery.
- For taxpayers and the public, transparency over large borrowers, recovery efforts and settlement decisions remains an important issue.
