SWABI, Aug 5: The House Building Finance Corporation (HBFC) has declared seven districts of the country as “massive default” and the district offices have been asked not to recommend applications of government employees; so for 50 per cent recovery of the outstanding Rs1,599.595 million has not been achieved.

A letter issued in July, (a copy of which is with Dawn), says that the recovery of loans as compared to disbursement by some district offices have not been good and have been categorized as “massive default”.

The total default amount has been shown at Rs1,599.595 million, and of the 18,914 accounts in the default districts only 716 account-holders had returned their loans in time.

The letter said that the recovery was only six per cent; hence and shortfall was 94 per cent from 1999 to 2001.

In the default areas, the district office of Murree, where 4,058 accounts were in default out a total 4,106 accounts in 1999, the default amount was Rs172.080 million; in 2000, of the 4,670 accounts, 4,595 accounts were default and the amount stood at Rs220.087 million; in 2001, the default accounts were slashed to 4,555, but the amount reached Rs 229.937 million.

In district office of Muzaffarabad, the total operative accounts in 1999 were 4,017 out of which 3,649 were in default and the default amount was Rs297.242 million. In 2000, out of the total operative 3,860 accounts, 3,591 were in default with the default amount shown at Rs331.468 million. In 2001, the total operative accounts were 3,751, of which 3,554 were in default and the total outstanding amount was Rs364.538 million.

Similarly, the district office of Dadu also falls in the category of default. Here, 3,707 accounts were operative in 1999 of which 3,599 were default, and the default amount stood at Rs270.892 million. Of the total 3,696 accounts in 2000, 3,586 had been declared default, outstanding amount was Rs300.361 million. In 2001, out of 3,636 operative accounts 3,549 stood in default with an outstanding amount of Rs320.427 million.

In district Rawalakot, the number of operative account in 1999 were 868, of which 777 were default and the default amount was Rs65.800 million. In 2000, of the 866, 818 were default and the recovery shortfall was Rs73.523 million, and in 2001, out of 776 operative accounts 738 were declared default and the default amount had touched Rs74.675 million.

In the Mardan district office, of the 2,826 accounts in 1999, 2,475 were in default and the default amount was Rs176.996 million, and the following year, of the 2,613 accounts, 2,306 were declared in default with the outstanding amount was shown at Rs182.688 million. In 2001, the operative account was reduced to 2395, and defaulters 2216, but the default amount reached Rs189.205 million.

In the Nawabshah district, of the 3,132 operative accounts in 1999,  2,917 had been declared in default and the default amount was Rs297.578 million. Similarly, in 2000, the total number of operative accounts was 2,965, but 2,816 stood in default, and the outstanding default amount was Rs322.030 million. In 2001, there were 2,889 operative accounts of which 2,780 had been declared default, and the default amount was Rs340.012 million.

The letter also said that it is quite evident that collectively these seven districts were responsible for the massive default of Rs1.6 billion.

In lieu of the alarming situation the competent authority had renamed these seven district offices as “recovery offices” until such time the default amount was reduced to at least 50 per cent.