Canara Bank has recovered ₹303 crore from Rajesh Exports following a loan default tied to unpaid letters of credit. Under CEO Brajesh Kumar Singh, the bank had already fully provided for this exposure in prior financial periods, meaning the recovery translates directly to relief on the balance sheet without impacting current profitability.
Rather than writing off the remaining balance, Canara Bank is aggressively pursuing recovery through the Debt Recovery Tribunal (DRT). The bank expects to recover additional funds directly from deposits that Rajesh Exports holds with the tribunal—a tactical move that shifts pressure onto the defaulter's own liquidity.
The default occurs against a backdrop of severe regulatory scrutiny. Rajesh Exports is already facing a SEBI probe over alleged revenue misrepresentation, compounding the lender's risk exposure and justifying the assertive recovery stance.
The Canara Bank action reflects a broader shift in Indian banking strategy. Lenders are moving from defensive postures on bad loans—tolerating write-offs and prolonged court battles—to active, tribunal-backed recovery efforts designed to maximize cash recovery and deter future willful defaults.
