PSU bank loan write-offs hit ₹12 lakh cr in 10 years

What the ₹12.08 lakh crore figure covers

Posts circulating on Reddit and other social platforms cite a Finance Ministry disclosure on loan write-offs by public sector banks (PSBs). The headline number repeatedly shared is ₹12,08,828 crore. The period attached to that figure is FY2015-16 through FY2024-25, commonly written as FY16 to FY25. Several users frame it as the ten-year aggregate for PSBs, based on data placed before Parliament. A separate thread of posts uses a broader label of “commercial banks” and cites a similar decade-sized number of about ₹12.3 lakh crore for FY15 to FY24. The ongoing discussion is largely about what write-offs mean and who ultimately bears the cost when large amounts are removed from bank balance sheets. Many posts also focus on how much of the decade total is concentrated in recent years. The overall takeaway from the shared context is that write-offs remain a large headline metric even as NPAs have declined.

Five-year chunk: ₹5.82 lakh crore and FY21 spike

A widely repeated number is ₹5.82 lakh crore of PSB write-offs during FY2020-21 to FY2024-25. Social posts highlight that this is a large share of the decade total of ₹12,08,828 crore. The most-cited single-year peak is ₹1.33 lakh crore in FY2020-21. Many commenters interpret that spike as part of balance-sheet clean-up efforts, rather than a sudden jump in fresh defaults. The same posts also note that write-offs have trended down more recently. FY2024-25 write-offs are cited at ₹91,260 crore, which is presented as lower than ₹1.15 lakh crore in the previous year. The five-year set of numbers has become the focal point because it sits alongside recovery figures shared for the same window. In the debate, the concentration of write-offs in FY21 is often used to argue that a large clean-up happened early, followed by moderation.

Year-wise trend: from peak to FY25 low

Some posts list a year-wise pattern around the FY21 peak to argue that write-offs are no longer rising. The figures widely circulated are ₹1.33 lakh crore in FY2020-21 and ₹1.16 lakh crore in FY2021-22. The same threads cite a rise again to ₹1.27 lakh crore in FY2022-23. A comparison commonly repeated is that FY2024-25 write-offs of ₹91,260 crore are lower than ₹1.15 lakh crore in FY2023-24. This sequence is used in social commentary to support a “downward trend” argument, even though the series includes a mid-period uptick. Some posts add an additional claim that 10 of 12 PSBs saw declines over five years, while SBI and Canara Bank rose in FY25, but that claim is discussed as a talking point rather than a full dataset publication. Based on the numbers being shared, the key observable is that FY25 is being presented as materially below the FY21 peak. The trend narrative is also tied to the broader NPA reduction data cited from Parliament.

Bank-wise leaderboard driving the debate

The online conversation frequently shifts from totals to bank-wise “leaderboards,” especially for the last five years. The most cited cumulative five-year figure is State Bank of India (SBI) at ₹1.14 lakh crore. Union Bank of India is cited next at ₹85,540 crore, followed by Punjab National Bank (PNB) at ₹81,243 crore. Bank of Baroda is cited at ₹70,061 crore, and Canara Bank at ₹56,491 crore. FY25-only write-offs are also circulated for some names, including SBI at ₹20,309 crore, PNB at ₹12,159 crore, and Union Bank at ₹11,634 crore. A table shared in posts also lists Canara Bank’s FY25 write-off at ₹14,350 crore. Commenters use these bank-wise numbers to argue about credit appraisal, legacy stress, and whether write-offs reflect clean-up of old NPAs. The same leaderboard framing also drives questions on recoveries and accountability.

Recoveries: ₹1.65 lakh crore and what it implies

Alongside write-offs, one widely shared number is PSB recoveries of ₹1.65 lakh crore over the same five-year period. Multiple posts compute this as roughly 28 percent of the ₹5.82 lakh crore written off in FY21 to FY25. This recovery ratio is central to the public reaction because it frames write-offs as more than a bookkeeping line item. Several social posts argue that recoveries are “poor,” while others respond that recovery can take longer and continues even after write-off. The context shared also includes commentary that recoveries were “settled” at low percentages, but those statements appear as opinionated claims rather than the Finance Ministry’s explanation. What is factual in the circulating dataset is the pairing of ₹5.82 lakh crore written off with ₹1.65 lakh crore recovered during that five-year window. The recovery figure is also used to compare banks, but most of the bank-wise recovery details are not provided in the shared highlights. For readers, the immediate implication is that write-off totals and recovery totals should be read together, not in isolation.

Government’s explanation: write-off is not waiver

The government’s stated position in the shared context is that write-offs are an accounting exercise used to clean bank balance sheets. The explanation is linked to the RBI’s Resolution of Stressed Assets Directions, 2025, as cited in social summaries of the parliamentary response. The key line being repeated is that a write-off does not result in waiver of borrower liabilities. The same explanation adds that the borrower does not benefit simply because the bank has written off the account in its books. This point is frequently reposted because it addresses a common assumption that “write-off” equals “forgiveness.” At the same time, social commentary questions what happens if recovery efforts remain weak even when liability technically remains. Some posts also discuss asset sales to Asset Reconstruction Companies (ARCs) at discounts as part of stressed-asset resolution, but the core mechanism emphasized in the government quote is balance-sheet clean-up. The practical takeaway from the official explanation is that write-off is a bank-side accounting step, while recovery and enforcement remain separate tracks.

NPAs fell sharply, Parliament told

Another set of numbers being shared comes from a written reply to the Rajya Sabha by Minister of State for Finance Pankaj Chaudhary. According to this disclosure, NPAs across the banking sector declined from around ₹8.73 lakh crore in March 2021 to ₹4.08 lakh crore in March 2026. The reported fall is over 53 percent over the five-year period. For PSBs specifically, NPAs are said to have fallen from ₹6.16 lakh crore in March 2021 to ₹2.45 lakh crore in March 2026. NPAs of private sector banks are also said to have reduced from ₹2.02 lakh crore to ₹1.26 lakh crore during the same period. In social discussions, these NPA numbers are used to argue that write-offs and resolution tools coincided with measurable improvements in asset quality. Another post cites a separate NPA comparison that gross NPA ratio dropped from 9.11 percent in March 2021 to 2.58 percent by March 2025, alongside a decline in gross NPAs from ₹6.17 lakh crore in 2021 to ₹2.84 lakh crore in 2025. These ratios are often cited to explain why PSU bank sentiment improved despite large write-off totals.

Market angle: profitability, recoveries, and returns

Some widely circulated summaries link the write-off debate to PSU banks’ improved profitability and market performance. One shared datapoint says PSBs reported an 11.2 percent year-on-year rise in net profit to a record ₹1.98 lakh crore in FY26. The same summary claims gross NPA ratio declined to 1.93 percent and net NPA fell to 0.39 percent, alongside a slippage ratio falling to 0.7 percent. It also cites total recoveries including from written-off accounts at ₹86,971 crore in FY26. Market-focused posts highlight that the Nifty PSU Bank Index delivered a CAGR of approximately 33 percent over five years from 2021 to 2026, compared with roughly 10 percent for the Nifty 50 over the same period. SBI’s five-year return is cited at 168.55 percent in those posts. A separate claim says across five named PSU banks, the average five-year return works out to approximately 250 to 260 percent. In online debates, these figures are used to argue that asset-quality clean-up and write-offs were part of a broader turnaround in the sector. For investors, the key is that write-off headlines are being discussed alongside improving NPA metrics, profits, and index performance.

What people are actually arguing about online

The debate is less about whether write-offs happened and more about interpretation and accountability. One side reads the ₹12,08,828 crore decade figure as evidence that corporate credit stress was repeatedly socialised through bank balance sheets. Another side emphasises the government’s line that write-off does not waive borrower liability and is meant to keep balance sheets realistic. The five-year concentration of ₹5.82 lakh crore is often used to ask why the clean-up was so heavy in a short window. Bank-wise tables, especially SBI and other large PSBs, drive questions around scale and legacy exposures. The recovery number of ₹1.65 lakh crore is used to challenge whether recovery mechanisms are keeping pace with write-offs. The NPA decline data is used to counter that the system has improved materially since 2021. Separately, the discussion occasionally mixes PSB-only figures with “commercial bank” totals, which can confuse comparisons across posts. A careful reading of the shared context suggests that the most defensible way to follow the issue is to keep time periods and bank coverage consistent, and track write-offs together with recoveries and NPA trends.