Rajan was replying to a Parliamentary panel on NPA,

Acknowledging corruption as a factor, he also said that though he had forwarded some names for filing cases against some "high profile" bank fraudsters to Prime Minister Narendra Modi, no action had been taken in the matter.

"A larger number of bad loans originated in 2006-08 when economic growth was strong, and previous infrastructure projects such as power plants had been completed on time and within budget.

"It is at such times that banks make mistakes. They extrapolate past growth and performance to the future. So, they are willing to accept higher leverage in projects, and less promoter equity," he said.

In his note to Parliament's Estimates Committee on public sector banks headed by BJP leader Murli Manohar Joshi, Rajan said that global slowdown, project cost overruns and government decision-making were among other factors that contributed to the process.

Gross NPAs accumulated in the Indian banking system has touched a staggering level of Rs 10 lakh crore.

Referring to malfeasance as a factor in the NPA issue, Rajan said: "Undoubtedly, there was some... clearly, bankers were overconfident and probably did too little due diligence for some of these loans.

"Unfortunately, the system has been singularly ineffective in bringing even a single high-profile fraudster to book. As a result, fraud is not discouraged.

"I sent a list of four high-profile cases to the PMO for coordinated action to bring at least one or two offenders to book. I am not aware of the progress. This is a matter that should be addressed with urgency," he added.

According to Rajan, the RBI had set up a fraud monitoring cell during his Governorship to coordinate early reporting of such cases to the investigative agencies.

The former Governor also blamed public sector banks for inadequate due diligence before and after handing out loans.

"Banker performance after the initial loans were made... (were) also not up to the mark," Rajan said.

"Unscrupulous promoters who inflated the cost of capital equipment through over-invoicing were rarely checked," he noted. He said the RBI could have been more pr-oactive and "raised more flags about the quality of lending in the early days of banking exuberance".

Rajan also said the phenomenon of loan waivers vitiate the credit culture and an all-party agreement to this effect would be in the country's interest in view of impending elections.