Exclusive: RBI’s Risk Assessment Reports on Axis Bank: Missing the Forest for the Trees
On 26 June 2019, confronted with a contempt petition filed in the Supreme Court of India by Right to Information Act, 2005 (RTI) activist, Girish Mittal, the Reserve Bank of India (RBI) finally disclosed the hitherto confidential annual inspection reports, called risk assessment reports (RARs), of select banks for the years FY12-13, FY13-14 and FY14-15.
 
These are State Bank of India, Axis Bank, ICICI Bank and HDFC Bank. 
 
The RAR, conducted by RBI after the end of the financial year, is a comprehensive document about its assessment of the concerned bank for that year. RBI grades every bank with a rating from 1 to 4, with 4 being the worst and 1 the best. 
 
RBI collects considerable material from banks, which is fed into a model that is weighted, and calculates a risk number. Neither the weightage nor the detailed calculation is disclosed to the banks. After discussing the draft report with senior management prior to its finalisation, RBI has the final word and the bank has to show signs of improvement in the subsequent year on the weaknesses highlighted in the report. In this article, we evaluate RBI’s RAR of Axis Bank in FY12-13, FY13-14 and FY14-15.

Axis Bank: RBI Risk Assessment Report 
 
(Note: Colour coding not in original report Source: RBI sourced via RTI)
 
RBI’s RAR of Axis Bank for FY12-13 presents a poor portrayal of the Bank’s governance, leadership and banking ability. The core skill of managing a bank is risk management, and the banking supervisor was of the view that this critical area needed to be 'toned up'. According to RBI, the business and control heads were working in segregated silos and “did not ensure that issues were brought before the relevant committees” for intensive examination and for guidance. The RBI’s rating for risk governance, at 2.38, was even higher than the already high risk rating of 2.301 for the overall aggregate risk for the bank, which indicates how poor risk governance was at Axis Bank. 
 
Credit risk, at 2.36, was marginally better than risk governance; nevertheless, it is higher than aggregate risk. RBI found “major weakness in the quality of credit appraisal,” as there was a shortfall in the valuation of securities at the time of settlement, compared to valuation at the time of sanction and origination, which pointed to lax collateral management. 
 
The division, which had the highest risk in the Bank, was market/treasury, at a very alarming 2.553. This division appears to have been mismanaged, as it had incurred operating losses on a stand-alone basis for four of the previous five years, and the Bank’s internal systems did not separately identify income from treasury and from the Bank’s internal customers through transfer pricing. 
 
There was also no independent verification of achievement of targets by treasury dealers.
 
The Bank did not maintain or monitor individual profit and loss for individual dealers. Worse, no disciplinary track record was incorporated in dealers’ performance appraisal in terms of breaches in risk limits. 
 
A bank’s treasury is an extremely sensitive, sanitised and restrictive area, but Axis Bank’s treasury was apparently porous. The dealers extensively used Reuters Messenger (RM) which had 'no audit trail and no oversight', and the Bank did not have a policy for its use.
 
In a violation of RBI policies, it was used as a primary means of communication with external customers in negotiations for pricing of deals. In both, the derivatives and foreign exchange treasuries, there was no separate inter-bank desk and customers’ desk, resulting in “inter-bank dealers communicating directly with external customers.” The trading book and derivatives book were also headed by the same individual. 
 
(Source: Axis Bank)
 
Despite Axis Bank reporting low gross NPAs (non-performing assets), between 1.1%-1.3%, in the FY12-13 to FY14-15 period, RBI’s RAR reveals that it was concerned with the credit risk at the Bank. What is peculiar in RBI RAR for Axis Bank over the three years is that, while the aggregate Bank rating improved from 2.301 in FY12-13 to 2.175 in FY13-14 and to 2.151 in FY14-15, the all-important credit risk rating only marginally improved from 2.36 in FY12-13 to 2.346 in FY13-14, and then deteriorated to 2.377 in FY14-15. 
 
To grasp the significance of this, we need to note that in Indian banks, credit risk is the major risk; indeed, it constitutes the overwhelming majority of risk-weighted assets. In Axis Bank for FY12-13, FY13-14 and FY14-15, credit risk assets were 85.2%, 84.4% and 83.8%, respectively, of total risk-weighted assets. With the credit risk rating persistently remaining above 2.3, which RBI considers high-risk, and credit forming the overwhelming bulk of risk-weighted assets, it is puzzling that the aggregate risk rating of Axis Bank improved. 
 
Axis Bank: Composition of Risk-weighted Assets
 
 
(Source: Axis Bank Annual Reports)
 
What is even more unusual is that it is the responsibility of senior management and the board of directors to monitor credit risk. Hence, the credit rating risk score should be mirrored in the score given to the board and to the senior management.
 
However, while credit risk remains poor, there is a significant improvement in the risk rating of the board and the senior management in FY13-14  compared with FY12-13, prior to deteriorating in FY14-15. While the credit risk score in FY14-15 is worse than in FY12-13, the score given to the board and senior management in FY14-15 is significantly better than in FY12-13. 
 
The public and the stock market are now well aware from events post-FY14-15.
 
That it was the major mismanagement in the Bank’s corporate loans which impacted the Bank performance and along with other issues of operational risk and integrity of accounts contributed to the truncating of the fourth term of former managing director and CEO, Shikha Sharma. There is, therefore, an obvious flaw in RBI’s rating of the board and the senior management in its RAR, as it appears to be delinked from the credit risk score. One hopes that RBI has corrected this from FY15-16 onwards.
 
Another critical shortfall in RBI’s RAR of Axis Bank for these years is its inability to comment on and rectify the strategic weakness in the Axis Bank board, which contributed to its poor performance and finally to the removal of its CEO, Shikha Sharma, by the banking regulator.
 
In all 3 years of Axis Bank inspection reports, while commenting on certain issues of the board pertaining to nominees of SUUTI (Special Undertaking Unit Trust of India) and Life Insurance Corporation (LIC) and certain other issues, the banking supervisor failed to highlight the elephant in the boardroom, namely, the negligible commercial banking and corporate credit expertise on the board of directors of a prominent private sector commercial bank. 
 
(Note: In FY12-13 & FY13-14 Nominations Committee was separate, chaired by SB Mathur & Kaundinya & Barua were members. In FY14-15 both committees were merged) Source: Axis Bank Annual Reports
 
One of the many shortcomings of Ms Sharma and the Nominations and Remuneration Committee (chaired by Prasad R Menon) was their inability to select seasoned commercial bankers, well-versed in corporate credit as directors on the board. Axis Bank was practically unique amongst commercial banks in India in that, during FY12-13-FY14-15, barring Somnath Sengupta (executive director, October 2012 – 2014) and his successor, Sanjeev K Gupta (ED & CFO only in FY2015, as he too, like Mr Sengupta, took early retirement) none of the executive directors had exposure to commercial banking, nor had they managed corporate credit or worked in a bank branch prior to their appointment in Axis Bank. 
 
Ms Sharma, appointed as CEO in June 2009, had a background in life insurance, investment banking and retail finance with the ICICI group. V Srinivasan, prior to his appointment in Axis Bank in 2009, had a background in investment banking, fixed income, treasury and foreign exchange. Debt and treasury management has limited corporate credit exposure, as it deals in highly rated credit instruments requiring negligible credit assessment and credit monitoring skills.  
 
In the three years under examination,  Axis Bank’s board of directors consisted of 13-14 members and, in each of those years, at best, the board had only three (two in FY12-13 and FY13-14) experienced commercial bankers, one of whom was a non-executive director.
 
Apart from the executive directors, the only non-executive directors who had commercial banking experience were KN Prithviraj and V Visvanathan (from FY14-15). 
 
From FY15-16 onwards it got worse, with V. Visvanathan (independent director) being the sole board member having commercial banking and corporate credit expertise; with the early departures of Mr Sengupta and Sanjeev Gupta the new executive directors such as Rajesh Dahiya (exposure to general corporate management) and Rajiv Anand (background in investment management and treasury) lacked  commercial banking and corporate credit expertise. 
 
In the light of recent events in Yes Bank and in many government banks, we can see that, even though the inclusion of experienced commercial bankers on the board of directors is not a foolproof mechanism for prudent credit risk management, a negligible and token presence of such expertise on the board of a bank is a major red flag.
 
It is apparent, that RBI did not consider the lack of commercial banking and corporate credit expertise on the board of a prominent private sector bank as a major risk factor which needed to be addressed – this in a bank which had 84% of its risk-weighted assets in credit and 45% (FY14-15) of total credit in corporate credit. 
 
This was all the more important when RBI had given Axis Bank a high risk credit score exceeding 2.3 in all the three years. It appears that the board, especially its nominations and remuneration committee (NRC), was oblivious to the need to get experienced bankers on the board in order to rectify the high risk credit score that RBI RARs were giving the Bank.
 
Unfortunately for Axis Bank shareholders, the board of directors, and the banking supervisor’s inability to address this gaping and visible hole, contributed to the Bank’s corporate credit quality rapidly deteriorating.
 
In FY12-13, the operational (non-IT) risk was 2.423, which indicates high risk, and RBI observed the bank had a high turnover of staff, e.g., while the Bank recruited 15,217 employees, 9,033 staff quit the Bank, and at the entry level, and in the sales and front-office, attrition rose significantly. 
 
The sales culture has put tremendous pressure on the front-office to sell financial products, and in the industry, at the base level, there appears to be high turnover, as staff move to other banks in an attempt to escape the pressure. 
 
RBI also noted the high and rising incidence of both, internal (staff) and external (customers) fraud. It also noted that the Bank had de-emphasised staff training, as expenditure allocated was low. Although the rating improved over the next two years, it became a major issue during demonetisation, when bank staff were arrested for money laundering.
 
In FY13-14, RBI’s RAR scored the Bank’s liquidity risk at 2.475, as it was concerned with the Bank’s dependence on short-term funds and volatile CASA (current and saving accounts) deposits; the Bank’s average cost of term deposits was higher than the median and average rate offered by major banks in the market.
 
The Bank’s liquidity was also constrained due to its reliance on top depositors for funding short-term 14-day liquidating assets. Since the liquidity risk rating improved to 2.19 in FY14-15, it appears that the Bank addressed the issue. 
 
The objective of RBI’s RARs of banks is to highlight the weaknesses and improve upon the risk management of the bank. Contrary to capital market expectation, banks are in the business of managing risk and not only to maximise profits. 
 
In the context of the three years of Axis Bank’s RAR being made available to the public via the RTI, one should credit RBI with having correctly identified the poor credit risk management of the Bank from FY12-13 to FY14-15. However, the role of the banking supervisor is to also identify the accountability for the same and monitor its improvement. 
 
In Axis Bank RBI not only failed to hold the board of directors and the senior management responsible, but gave the board and the senior management a better aggregate risk score in FY14-15 compared with FY12-13, while showing a worsening score for credit risk for those years. 
 
Shockingly, RBI inspectors were also unable to see the strategic risk in the composition of the Axis Bank board of directors and the virtual non-existence of commercial banking and corporate credit expertise at the top.
 
Events since FY14-15 have clearly revealed the failure of the Axis Bank board and its senior management in managing credit, operational risk and the integrity of the financial accounts. The RBI too has to accept responsibility for failing to act and to restructure the board at the necessary time. 
 
In this sense, then, the RBI's RARs of Axis Bank, though interesting for students of banking, misses the forest for the trees.
 
Here are the inspection reports of the Axis Bank as provided by RBI to Girish Mittal under the RTI Act...
 
 
 
 
 
 
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    COMMENTS

    SuchindranathAiyerS

    5 months ago

    India's movers and shakers are all completely out of their depth as behooves products of a National "culture" that demolished all standards to make the tyrants, Backwards and Backwardness look good

    Finally, RBI Shares Inspection Reports of SBI, ICICI Bank, Axis Bank and HDFC Bank under RTI
    The Reserve Bank of India (RBI) after getting strictures and strict warning from the Supreme Court, has finally shared inspection reports of four banks under the Right to Information (RTI) Act with activist Girish Mittal about a fortnight ago.  
     
    RBI, in a letter on 26 June 2019, wrote to Mr Mittal, that "In compliance with the SC judgement (on 26 April 2019), please find enclosed a CD containing inspection reports sought by you...after severing information which is exempted from disclosure under Section 8(1)(j) of RTI Act."
     
     
    RBI shared inspection reports of ICICI Bank, Axis Bank and HDFC Bank for 2013, 2014 and 2015. For SBI, the period is for four years from 2012 to 2015. "...in view of the stay order by the High Court of Bombay in writ petition no.7711 of 2016 and no.8409 of 2016, we regret our inability to disclose the inspection reports of ICICI Bank, Axis Bank and HDFC Bank for the year 2012 at this state," the central bank said. The first of our analyses of these reports is out today. Its is on SBI, done by our columnist R Balakrishnan.
     
    Mumbai-based Mr Mittal had been trying to get information from the central bank on inspection reports of ICICI Bank, Axis Bank, HDFC Bank and State Bank of India (SBI) under the RTI Act. However, instead of sharing copies of the reports, the RBI tried not to share the reports citing fiduciary relations at every stage. 
     
    RBI even challenged the decision of central information commission (CIC) before the apex court. However, the Supreme Court repeatedly told RBI to share information. In fact, in March 2019, the apex court even threatened the RBI with contempt proceeding for not disclosing banks' annual inspection reports under the RTI Act. 
     
    Earlier, both, the apex court as well as CIC had held that RBI cannot refuse to put in the public domain the annual inspection reports of banks. However, RBI has refused to follow these orders saying that these reports contain 'fiduciary information' as defined under the RTI Act and, hence, cannot be placed in the public domain. 
     
    RBI’s repeated refusal to share banks’ inspection reports, prompted Mr Mittal to approach the Supreme Court. 
     
    In his petition before the SC, Mr Mittal, represented by senior counsel Prashant Bhushan and Pranav Sachdeva, contended that he had sought information under the RTI Act in December 2015 like copies of inspection reports of ICICI Bank, Axis Bank, HDFC Bank and State Bank of India (SBI) from April 2011 and copies of case files, with file notings on various irregularities detected by RBI in the case of Sahara Group of companies and erstwhile Bank of Rajasthan.
     
    The petition recalled the Supreme Court ruling in a case that RBI is clearly not in any fiduciary relationship with any bank. RBI has no legal duty to maximise the benefit of any public sector or private sector bank and thus there is no relationship of 'trust' between them. (Read: SC issues contempt notice to RBI in RTI case)
     
    Another issue pending before the courts is declaring the wilful defaulter’s list. Last year in November, the CIC had issued a show-cause notice to Dr Urjit Patel, the then governor of the RBI, for not honouring a judgement of the Supreme Court on disclosure of wilful defaulters’ list who had not paid loans of Rs50 crore and more. (Read: RBI Governor Gets Show Cause Notice from CIC for Not Disclosing Defaulters’ List)
     
    In the notice, the then central information commissioner Prof Sridhar Acharyulu had also asked the prime minister’s office (PMO), finance ministry and RBI to make public the letter sent by previous governor Raghuram Rajan on bad loans.
     
    Earlier in February 2016, the Supreme Court had directed RBI to furnish a list of the companies which are in default of loans in excess of Rs500 crore or whose loans have been restructured under corporate debt restructuring (CDR) scheme by banks and financial institutions. (Read: Supreme Court asks RBI to submit list of big defaulters)
     
    Even in December 2015, the apex court, in a landmark judgement, had told RBI that the banking regulator cannot withhold information citing 'fiduciary relations' under the RTI Act. 
     
    Hearing a set of transferred cases, a division bench of Justice MY Eqbal and Justice C Nagappan had said, "From the past we have also come across financial institutions which have tried to defraud the public. These acts are neither in the best interests of the Country nor in the interests of citizens. To our surprise, the RBI as a Watch Dog should have been more dedicated towards disclosing information to the general public under the Right to Information Act. We also understand that the RBI cannot be put in a fix, by making it accountable to every action taken by it. However, in the instant case the RBI is accountable and as such it has to provide information to the information seekers under Section 10(1) of the RTI Act."
     
     
     
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    COMMENTS

    P M Ravindran

    5 months ago

    Good that the apex court found merit in disclosing bank inspection reports overriding the fiduciary claims. How about disclosing info under the RTI Act about the judicial proceedings which have no such claims? Even a decision of the Central Information Commission, upheld by two benches of the Delhi high Court, is pending on appeal by the apex court in the apex court.

    drravindravpawar

    5 months ago

    🙏

    Bina Damania

    5 months ago

    Similar corruption exists in govt offices. Police,municipality,housing societies-so much open bribery without questioning or ombudsman-can RTI change things.

    Ramesh Poapt

    5 months ago

    pvt banks can be as much dirty aspsu banks, if not more...
    ex yes bank

    Ramchandra Karve

    5 months ago

    List of defaulters should be published on the Front Page of all the leading news papers along with their photos and photos of the bank officers who helped them in the process of looting the public funds in the banks.

    REPLY

    PRADEEP KUMAR M S

    In Reply to Ramchandra Karve 5 months ago

    👍

    Mayank Raina

    5 months ago

    The Government of India should shut down retail operations of all PSBs; having only 1 or 2 branches in any city thereby cutting down on staff having all lending decisions made by central committee which can be 4-6 depending upon carving out of zones on a pan-India basis lending only to NBFCs against quality portfolio, Large Corporates and MSMEs; though not going to be 100% effective but would be a significant improvement from the current mess. Besides, will also result in cost-cutting.

    PRADEEP KUMAR M S

    5 months ago

    Exhilarating, but long way to full clean up.
    To me HDFC bank is a Rothschilds baby, a foreign bank in Indian skin.
    A wolf in wolf form is far more safer than a shylock in Angels(Oberoi's) clothing.
    At Oberoi, they serve Puries very very clean. As for HDFC.................? 🤔

    Ajay Sharma

    5 months ago

    Where can we access the reports?

    Exclusive: RBI Inspection Reports on SBI Reveal Evergreening, Window-dressing, Cover-ups and Worse
    After a long battle with the Reserve Bank of India (RBI) from 2016 (Finally, RBI Shares Inspection Reports of SBI, ICICI Bank, Axis Bank and HDFC Bank under RTI), Girish Mittal, a dogged Right to Information (RTI) activist, was finally granted access to bank inspection reports for four years – 2012, 2013, 2014 and 2015. Now that we have them, it is important to find out what the RBI fought so hard to hide and suppress, on behalf of banks—to the extent that it even claimed a fiduciary relationship with the banks. 
     
    Although the reports are now a little dated, it is worth diving into what the RBI inspects and how seriously banks take these inspections and correct themselves. 
     
    I studied the four inspection reports of SBI that have been released by RBI. The reports find fault with the bank across every operation. However, I am going to make allowances for the fact the some slippages are bound to happen given SBI’s sheer size and scale. What still comes out very starkly is the complete lack of accountability and ownership. 
     
    Each year, RBI subjects every bank to an inspection that focuses on risk management and integrity of accounts. The inspections are fairly comprehensive and help bring out the deficiencies in risk management, processes and the overall functioning of the bank.  
     
    These reports are submitted to the concerned bank, discussed with them and thereafter, the bank is expected to remedy the deficiencies. So, it is logical to expect that a deficiency that is pointed out in one year is not repeated in the inspection report of the next year, IF the directors and the management of the board take the reports seriously. 
     
    The owner of the public sector banks (PSBs) is the Government of India. This essentially means that there is no real ownership and PSBs exist merely to serve political bosses. The RBI reports make depressing reading and if the holes that it drills in the bank’s operations were plugged, the government would not need to repeatedly pump in money to re-capitalise banks. But this doesn’t seem to bother anyone. 
     
    Check the images below. They are just a sample of hundreds of pages of deficiencies across each and every parameter of SBI’s operations that the RBI has documented. And since this is unlikely to be a 100% check, there could be a lot more. 
     
     
    (Rupees in million.  Last column is 2013 March, and the first one is 2015 March)
     
     
    SBI scores poorly on every single issue that the inspection reports have commented on—from management quality to sophisticated risk management tools.
     
    In the old days, transactions were simple and banks did not need to recruit specialists or assign certain tasks to people with relevant expertise and domain knowledge. Everything could be reduced to template form filling and any credit over four crore rupees was to be submitted to RBI for prior approval. Today, the complexities are a thousand-fold and delegation is extensive. But SBI does not seem to have a grip over what is required. 
     
    The Risk Assessment Reports (RAR) for each year, throw up the same errors of omission and commission, a concerted effort to cover up non-performing assets (NPAs) by window dressing, suppression of data, evergreening of loans, ignoring laid down KYC (know your customer) procedures, flouting Anti-Money Laundering rules, suppressing employee fraud, ignoring RBI reports on deficiencies, inability to manage processes and risks etc.  This seems to be the DNA of the bank. Or it doesn’t give a damn about RBI inspections, since there is no attempt to correct issues.
     
    The lack of ownership in processes and controls is partly attributable to the lack of continuity at the very top. Every new CEO seems to just focus on ‘managing’ profits. So there are huge write-offs in the first year of every new chairman (nice way to blame the predecessor) and targets are based on a low base – this practice condemns the bank to mediocrity. 
     
    Add to this the short tenure at the top (from an organisation point of view), in a business where technology and complexities are dynamic, risk management remains an orphan. In one inspection report, RBI has pointed out that the chief risk officer was also on the credit committee! It is like the cat guarding the milk.
     
    Given the short tenure at the top and the fact that there is no ownership, the chairman is focused on bigger things like public relations (PR), pleasing the political bosses and planning post-retirement sinecures.  
     
    Once upon a time, SBI could be choosy about who to lend money to. Today, it has to compete with well-run private sector banks like HDFC or Kotak who now snatch away the best businesses. 
     
    And, yet, there seems to be a complete lack of interest in the way the bank is run. This is best summarised by the image below that resulted in the annual report mentioning an incorrect number of branches. 
     
     
    The success (measured for a bank in terms of size, asset quality and RoE) of a financial institution is dependent on how robust its systems, controls and processes are. This is especially true in an automated environment, where nothing can be left to personal discretion or subjectivity. 
     
    The inspection reports point to violation of know your customer (KYC) norms, which probably leads to likely abetment of money laundering; one report also says that bank officials were reluctant to share information. 
     
    Recurring violations pointed out by the inspections include inability to balance cash in ATMs, reluctance to prosecute employee frauds are some of the recurring themes.  
     
    In credit, RBI points to improper assessment of credit needs, non-enforcement of security given, shortfall in loan security as advised, disbursement of loans even before a charge is created on the collateral, lack of surveillance on credit.
     
    Evergreening of loans is evident from the undue increase in loans to problem sector such as diamonds, power, etc, violation of single customer credit limits, violation of sector limits. Clearly, the board is to blame. 
     
    Unsurprisingly, the RBI inspections have repeatedly pointed to SBI trying to hide bad loan by ever-greening accounts, granting loans to associate companies to meet other loan obligations, unauthorised lending against capital market Instruments, granting indulgence to borrowers, not keeping the board informed of credit related problems…the list is endless. 
     
    The inspection reports also points to repeated frauds in retail loans, SME (small and medium enterprise) loans, government schemes… there is no aspect of credit that is clean. There are also issues with SBI’s overseas operations, which require compliance with our laws as well as those of the countries they operate in. 
     
    This leads us to the big question. Does the board of directors have any knowledge of things? Do they even get to read the inspection reports that the RBI sends the banks? Are they tabled at board meetings? Do they boards ask why the same issues appear year after year? What about the statutory auditors? Do they note the findings of the RBI inspection? Do they bother to check why the same issues remain unaddressed? How does the internal audit mechanism work? Are their findings monitored by the board? 
     
    Each year, the report also reconciles the profits as ‘reported’ (I presume this is after audit by the statutory auditors) and as amended by the inspection. There is also a detailed list of some large borrowing accounts that SBI has not recognised as NPAs (non-performing assets) or not classified as weak accounts. As a result, the profits are inflated due to insufficient provisioning. A glance at those names and the amounts involved clearly indicate compromised lending standards.
     
    Some of those accounts are in the national news today. By postponing the recognition of bad debts, the management is pushing the chances of recovery farther away. Clearly, each chairman is only focused on pretending that the bank is performing better than it is.  
     
    SBI is a great franchise. But we need to stop the bleeding of the taxpayer money that goes in as recapitalisation. My first impression is that someone with ownership and commitment can double the RoE. It has advantages of size, reach and by status of its being a preferred banker to the government.  The management structure needs to be revamped. Risk management and operations need focus and continuity of supervision. Business has to be subjugated to risk management and not the other way around. 
     
    However, in the area of credit, something can be done within the present constraints. All credit decisions need to be centralised. Local outposts and branch managers should be devoted to compliance, processes and operations. 
     
    I should also add one positive observation. The report for the year 2014-15 was not as harsh as the earlier ones. Hopefully, the public noise over NPAs and frauds is the catalyst that improves things. 
     
    Here are the inspection reports of the SBI Bank as provided by RBI to Girish Mittal under the RTI Act...
     
     
     
     
     
     
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    COMMENTS

    dipankar ghosh

    4 months ago

    to solve out such type irregularities most important issue is stringently de politicization of psu bank is needed it is not possible here where is the credentiality of political system on the other hand to correct other entity
    one has to ascertain doubtful entities(though in india it can be place for obtaning bribes)and to get themselve autided by int- auditfirm if irregularities are soughed out immediate imprisonment with expeditious trial but good gesture of society is required.

    Shankar

    5 months ago

    Also please analyse the latest RBI inspection reports for years 2017 and 2018

    Jayaraman

    5 months ago

    This is the reality we need to face. That's why I had suggested earlier that some of these Private Banks CEO have to be deputed to these Banks. RBI has to ensure that these Private Bank's MD & CEO have to have compulsory one term of 5 years to be in a PSU Bank posting at the helm. They shall imbibe how the checks and balances, policy guidelines / framework needed to be established. This will help the PSU Banks also to learn what is called accountability and how their profitability can be improved qualitatively and quantitatively and that too sustainably.

    P M Ravindran

    5 months ago

    Not at all surprised. Being a public owned institution in India means there is practically no ownership whatsoever. I mean no accountability whatsoever. If this is the state of banks which at least have an index-profits-to measure their performance just imagine the frauds in our institutions for delivery of services of the government. I once sought information of the authority conducting inspection of the Collectorate and the copy of the latest such inspection report from the Palakkad Collectorate. Need I say I did not get any?

    kiran

    5 months ago

    Only Moneylife has published analytical reports on RBI inspection of SBI,Axis bank and done a successful watchdog services to investors. We eagerly await the same on ICICI bank.

    sarbeswar lenka

    5 months ago

    is it that bad, honestly?

    . PARSHANT

    5 months ago

    A report obtained by so called RTI activist and Interpreted, made news by novice correspondent and again commented by social media activist.
    Please first gain knowledge to understand the nitty gritty before uttering out fakeness..

    REPLY

    P M Ravindran

    In Reply to . PARSHANT 5 months ago

    What nitty gritty should one understand? The bank accepts deposits from the public at a paltry interest of say 5 percent and lends it to the needy at a high interest of about 12 percent. And then if the government has to pump in tax payers' money to cover bad debts is there anything more required to indict the bank for incompetence and fraud?

    VASANT KULKARNI

    5 months ago

    NOW THE TRUE BATTLE BEGIN BETWEEN GOOD, BAD AND THE UGLY.

    Mahesh S Bhatt

    5 months ago

    Mera Bharat issi liye Mahaan Hai Sar-Car kaun chalata hai yeh kabhi maalum nahi padega.Dhundte rahe jaaoge Sab chalta Hai Bhai All is in the well Mahesh Bhatt Kirticorp $5 trillion tak Gol Maal Haunting rahe ga.

    Harish

    5 months ago

    An ILFS in the making?

    DeepakSB

    5 months ago

    "What still comes out very starkly is the complete lack of accountability and ownership."

    -VERY TRUE AND APPROPRIATE REMARK VALID FOR EVEN FOR INDIVIDUAL SBI ACCOUNT HOLDER.

    Total harassment being caused to individual account holders while dealing with SBI.

    I had a very bitter experience when approached SBI for a student overseas education loan.

    I was given in writing by a corrupt official -Loan Dept.-of bank -WHO WAS EXPECTING SOME BRIBE -that my student loan will lapse if disbursement is NOT taken within a year.

    Even I was charged loan processing fee-WHICH IS NOT APPLICABLE FOR STUDENT LOAN.WHEN I PROTESTED,MY LOAN PROCESSING FEE WAS REFUNDED BACK.

    I had complained to vigilance dept. of SBI at Nariman polint( SBI Chairman's office ,and Zonal BKC offices at Bandra Kurla Complex. ).

    By the time my issue got resolved-these CORRUPT official had RETIRED with hefty retirement benefits and pension !!!!

    Such a state of affairs with SBI at grass root level.

    One can imagine what must be happening with corporate customers !!!!!!

    REPLY

    P M Ravindran

    In Reply to DeepakSB 5 months ago

    Yes, the SBI is totally indifferent to ordinary customers. In fact I had to approach the then Governor of RBI to get even my pension issue sorted out. Even the banking Ombudsman had failed me, fraudulently.

    deepak sharma

    In Reply to DeepakSB 5 months ago

    What about the corruption in police and judicial department???

    P M Ravindran

    In Reply to deepak sharma 5 months ago

    Corruption in police and judiciary is rampant. In fact Transparency International which carried out a survey and reported that these two are the most corrupt institutions in India, is facing prosecution under the Contempt of Court Act. While this is a contributory factor for the total failure of the rule of law, it cannot be a justification for any crime.

    Ramesh Poapt

    5 months ago

    not 'to big to fall'..it can b a n bomb sometime if not taken care of.

    PRADEEP KUMAR M S

    5 months ago

    SBI or Alibaba's caves?

    REPLY

    darsh kkka

    In Reply to PRADEEP KUMAR M S 5 months ago

    Unfortunate to target sbi only, why private bank details missing..??

    Sucheta Dalal

    In Reply to darsh kkka 5 months ago

    because everything cannot be in one article. This itself is just the highlights of four years of fat inspection reports. Read moneylife regularly you will find the other four published too -- doesnt matter the price we pay in lost advertisements!!

    PRADEEP KUMAR M S

    In Reply to Sucheta Dalal 5 months ago

    Exactly

    darsh kkka

    In Reply to Sucheta Dalal 5 months ago

    I see icici bank too...thanks a lot..you are true hero in journalism..Moneylife is home page for my mobile browser..I am regular follower of it..great going

    Shankar

    In Reply to Sucheta Dalal 5 months ago

    Madam, Thanks for the great work by Moneylife. Please analyse and upload the recent years inspection reports for years 2017 and 2018 of the big banks. Please also analyse the Yes Bank and also other top public sector banks inspection reports

    PRADEEP KUMAR M S

    In Reply to darsh kkka 5 months ago

    Yes, I too am waiting for it. Hope for it from ML itself

    Sucheta Dalal

    In Reply to PRADEEP KUMAR M S 5 months ago

    Thank you. Appreciate your hope from us, but do also ponder over why mainstream media does not 'break news' on SUPER large entities who are BIG advertisers -- at least not until they are already in serious trouble already and regulatory action begins -- that is then reported!

    nilesh prabhu

    In Reply to Sucheta Dalal 5 months ago

    That is the reason, readers trust Moneylife more than any other Main stream media

    PRADEEP KUMAR M S

    In Reply to Sucheta Dalal 5 months ago

    I lay hope at your doorstep, as I can trust what I read, and not be bothered to break my brains to figure out how my perceptions are being hijacked. Thank you for your great work. Your existence is MY necessity

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