Coal news and updates

State-owned banks may lose Rs96K cr on coal block cancellations

Already grappling with stressed assets, public sector lenders could take a hit of Rs 96,484 crore due to the Supreme Court’s decision to cancel coal blocks to power projects.

“The impact of cancellation of coal block allotment on public sector banks due to likely stoppage of production of power plants is estimated at Rs 96,484 crore,” minister of state for finance Jayant Sinha said in a written reply to a question in the Rajya Sabha on Tuesday. He, however, did not clarify if all the Rs 96,484 crore loaned by banks to the projects may turn into bad debt if mining is stopped. “As per the information collected from public sector banks, the exposure of all PSBs to the power sector is Rs 5,82,469 crore,” Sinha said.

The Supreme Court in September had cancelled allocation of 204 coal mines that were given out since 1993 on grounds of irregularities.

Source: Indian Express