A fictional investigative series inspired by patterns observed in publicly documented corporate governance failures
It's seven in the morning and he had done this a hundred times before. Two days since his salary had come in. He stopped at the ATM on his way to office, meaning to withdraw ₹10,000 and be done with it before the workday started.
He inserted the card. Typed the amount.
The screen loaded for a moment longer than usual and then the message appeared:
TRANSACTION DECLINED.
He frowned, assumed a technical fault and tried again — this time for ₹5,000. Declined again.
He turned around. The man using the next ATM was staring at the same kind of message on his own screen. A third man stood a little further off, phone to his ear, voice rising with the first edge of worry: "It isn't coming through for me either — is yours working?"
That was the moment it stopped feeling like his problem alone.
He opened the banking app. It wouldn't load. He called customer care. The line was busy. He tried again. Busy again. He put the phone away and walked quickly toward the nearest branch — passing, on his way, the bank's own signboard with its promise of trust printed just below the name, a promise that suddenly felt like it was mocking him.
By the time he reached the branch, 15 or 20 people were already standing outside. Some held passbooks, some ATM cards, some just their phones. Every face carried the same question: What happened?
An elderly woman stood near the front, her passbook pressed to her chest like something that could still be protected by holding it tightly enough. "My entire life's savings are in here, son," she said to no one in particular. There was no anger in her voice. Only fear.
A short distance away, a small shopkeeper was reading the news on his phone. A breaking alert had just appeared: Reserve Bank imposes restrictions on the bank — cap placed on deposit withdrawals.
He read it a second time. A third time. The words didn't change.
His loan instalment was due this week. That was the only reason he had come — to withdraw the money for it. Now he couldn't even access his own account to pay his own debt.
At nine, the branch doors opened. The first few customers inside learned the truth directly: At present, we cannot release more than ₹50,000 from any single account.
The sentence didn't take long to travel. Someone near the front repeated it, quietly, to the person behind them. Within moments, it had reached the back of the queue.
The branch manager sat behind his desk with a circular in front of him that laid out every new rule the bank now had to follow. What it didn't contain was a single sentence explaining why any of this had become necessary.
One customer asked him directly, his voice tight: "Sir — is our money safe?"
The manager looked up. He was quiet for a moment before answering. "Your money is there, sir. But right now, there is no way to withdraw the full amount."
That answer didn't ease the customer's doubt. It deepened it.
Because if you cannot access money that is supposedly yours, in what sense is it still yours?
By afternoon, the news had spread across the country. Television channels ran the story continuously. The bank's stock collapsed within hours of trading.
But this collapse hadn't begun that morning. Its foundation had been laid years earlier.
How It Began
Years before that morning, this bank had built a reputation as one of the fastest-growing private banks in the country. Every quarter brought new records. Every year, its loan book grew larger, including very large loans to major corporate groups. To the market, it looked like a genuine success story.
Analysts called it a growth story. Investors called it the bank of the future. The share price climbed. Confidence climbed with it. And alongside that confidence, the loan book kept expanding.
But quietly, buried inside the same set of numbers everyone was celebrating, another figure was rising too — one that almost no one was watching. The bank's loan growth was outpacing its deposit growth. In the beginning, the gap was small. Then, quarter after quarter, it widened. The market kept watching the growth. Almost no one asked what was holding up that growth.
Around that time, a credit analyst reviewing the bank's financial statements did something most of her peers weren't doing. She wasn't looking at profits or the share price. She was looking at one ratio: loan growth against deposit growth. They weren't moving in the same direction.
She checked the numbers again. Read the filings again. And wrote, in her own notes, a single line: "This bank's loan growth is outpacing its deposit growth. If this pace continues, funding pressure is inevitable."
She sent that note up to her senior. He read it — and didn't act on it.
At the time, there seemed to be no reason to. Every visible indicator was strong. Profits were rising. The market was full of praise. It is difficult, in a moment like that, to take a warning seriously. The file was closed.
Time passed. One by one, several of the large corporate loans the bank had extended began to run into trouble. First, one account. Then, another. Then, another. Repayments stopped coming on schedule.
Each time, the bank's leadership offered the same reassurance in internal meetings: This is temporary. These companies will recover. Acting on that belief, some loans were restructured. Some troubled accounts were given additional funding, in the hope that a little more time and a little more money would resolve things.
It didn't resolve. It changed shape.
Every quarter, the bad loans grew a little further. To outsiders, this showed up as a number in a report. To the people inside the bank, it was a risk compounding in real time.
The Reserve Bank's inspections grew progressively more thorough. Regulators began to notice a widening gap between what the bank's own books showed and what appeared to be the underlying reality. Questions were raised about loan quality. About capital reserves. About the bank's ability to raise the funds it needed. Each question was answered — but every answer only led to a further question.
Eventually, the regulator acted: restrictions were imposed on the bank, withdrawal limits were placed on deposits and a new board was appointed. A reconstruction process, backed by other financial institutions, began soon after.
None of this history was visible to the employee standing at the ATM that morning. Or to the elderly woman in the queue outside the branch. Or to the small trader waiting to withdraw money for his loan instalment. All they knew was one simple fact: their own money, at the moment they needed it, was not reaching their hands.
The elderly woman was still sitting outside the branch, her passbook held tightly in both hands. She had never heard terms like ‘capital adequacy’ or ‘non-performing assets or NPAs’ or ‘provisioning’. What she knew was this: money she had saved across many years of her life was now standing behind a limit she hadn't agreed to and couldn't explain. Something in her had quietly stopped trusting.
The small trader sat on the branch steps, doing arithmetic on his phone. Workers' wages. Shop rent. The loan instalment. Every number mattered. And the money sitting in his own bank account, the money that was supposed to cover all of it, wasn't available to help with any of it.
That same evening, the credit analyst opened her old file again. Her note from two years earlier was still there, unchanged. She sat with it for a while. Then she picked up her pen and added one more line beneath it:
"The growth was visible to everyone. What that growth was standing on — almost no one looked at."
What This Pattern Teaches
Not every fast-growing institution is unsound. Equally, fast growth is not, by itself, a reason for blind confidence either.
Sometimes, growth itself is the warning. When a bank's loans are growing quickly, the question worth asking is simple: are its deposits — the funding base behind those loans — growing at the same pace? Is the institution building its foundation with the same strength it is using to build its loan book?
These are not accusatory questions. They are questions of basic diligence. Trust in the banking system isn't placed there only by large institutional investors. It is placed there by the salaried employee. By the pensioner who has saved across a lifetime. By the small shopkeeper who depends on his account to run his business day to day. All of them are relying on the same foundation.
Before applauding growth, it is worth asking what that growth is standing on. Sometimes the greatest risk isn't found in losses. It is hidden inside growth moving faster than its own foundation can support — the same way speed, in any part of life, creates excitement even as it quietly erodes the margin for safety.
Case Status: Closed.
Evidence fades. Patterns don't.
(SVVN Babji Rao is a retired deputy commissioner (prohibition and excise), Govt of Andhra Pradesh, with 39 years of experience in investigation, enforcement and administration. A law graduate and corporate governance practitioner, he writes on governance, institutional behaviour and investor protection. His Case Diary series examines the warning patterns behind corporate failures.)
