The bankers who did not want to be quoted said this was necessary to fulfill the assurance of finance minister Yashwant Sinha to go on a war footing for recovering NPAs.

"We fear witch-hunting by these investigating agencies which could be a dampener on taking decisions, as recovery of NPA dues would require freedom to even drastically reduce the penalty for defaulters which could run into several crore," they said.

After a meeting with the chiefs of the public sector banks, finance minister Yashwant Sinha urged the RBI to prepare guidelines by July 15 this year for recovery of NPAs.

Explaining the stringent penalties against loan defaulters, they said even a 15 per cent interest on a default of Rs 6 crore for ten years would work out to Rs 16.5 crore. "Since the drastic measures for recovery is being worked on the assumption that some defaulters may not even pay up the original amount, the notional cumulative amount inclusive of interest would work out two and a half times," they said adding some waiver on it itself could be a few crore attracting attention of the investigating agencies.Launching a legal battle in some cases could turn out to be a `wild-goose' chase depriving banks an opportunity to recover at least the principle amount, they said.

Bankers also desire that the CVC should spare no efforts in moving against those who try to file `malicious' cases against senior bank officials, they said.Meanwhile, according to finance ministry sources, RBI is proceeding well to meet the deadline for bringing out the guidelines for recovery of NPAs by public sector banks.

Gross NPAs are estimated at Rs 51,667 crore as in March 2000, as against Rs 51,570 crore during the corresponding period of the previous year.High value NPAs, during the period, formed 51.90 per cent of the gross NPAs of public sector banks with efforts now being made to recover Rs 26,881 crore locked in 6993 high value accounts, the sources said.

While about 23 per cent of these NPAs are more than five years old, about 37 per cent are less than two years and 40 per cent more than two years but less than five years.