In the second quarterly performance review in six months, Jaitley brainstormed with SBI Chairperson Arundhati Bhattacharya and other PSU bank heads as well as RBI officials over the rising bad loans in different sectors including steel, credit offtake, health of the lenders and status of social security schemes.

The gross Non-Performing Assets (NPAs) of Public Sector Banks rose to 6.03 percent at the end of June, as against 5.20 percent in March this year. The meeting had secretaries of various departments making presentations on the credit requirements for projects in the sectors under them.

"When we took assessment of certain sectors which had a higher level of NPAs, some particular defaulters which are common thread running across several banks did crop for discussion," he told reporters after the meeting. The public sector banks, he said, "have all the powers... Banks today have full authority and autonomy to take action against them (defaulters)".

Jaitley was replying to a question on State Bank of India declaring Vijay Mallya a 'wilful defaulter' for not paying nearly Rs 7,000 crore loans to the long-grounded Kingfisher Airlines. Major stress of the banks will ease once the sectoral issues are sorted out and economy improves, he said.

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