IL&FS Case: NCLT Seeks Presence of Axis Bank, StanChart CEOs
The Mumbai bench of National Company Law Tribunal (NCLT) has directed the chief executive officers (CEOs) of Axis Bank and Standard Chartered Bank to be present at the next hearing of the IL&FS matter on 16th December.
 
Hearing a contempt petition against Amitabh Chaudhry and Zarin Daruwala, the CEOs of Axis Bank and Standard Chartered Bank, respectively, the tribunal on Monday observed that both the executives have not presented themselves before the bench.
 
Axis Bank said that it would take 'appropriate' steps after receiving the order.
 
"The matter pertains to operations of these accounts in the Bank's branch. The Bank has high respect for all court/tribunal orders. Bank denies the allegations and on receipt of the NCLT Order, Bank will take appropriate steps," an Axis Bank spokesperson said.
 
A Standard Chartered India spokesperson said: "We are yet to receive the copy of the order. Upon review of the contents of the order, we will decide the way forward."
 
The case pertains to the two banks allegedly allowing of Ramesh Chandra Bawa, former IL&FS Financial Services (IFIN) head and his family to withdraw money from their accounts in these banks and also to access the lockers even after the accounts were frozen by the NCLT.
 
Disclaimer: Information, facts or opinions expressed in this news article are presented as sourced from IANS and do not reflect views of Moneylife and hence Moneylife is not responsible or liable for the same. As a source and news provider, IANS is responsible for accuracy, completeness, suitability and validity of any information in this article.
  • Like this story? Get our top stories by email.

    User

    Anurag Thakur: Bank NPAs have fallen by nearly Rs 98,000 crore to Rs 9.38 lakh crore by June end 2019
    The gross non-performing assets (NPAs) of scheduled commercial banks (SCBs) have fallen by nearly Rs 98,000 crore to Rs 9.38 lakh crore by June end this year, Minister of State for Finance Anurag Thakur informed the Lok Sabha today. 
     
    According to Reserve Bank of India (RBI) guidelines, banks do not have any Minimum Balance requirement for Basic Savings Bank Deposit accounts (BSBD), including accounts opened under Pradhan Mantri Jan Dhan Yojana (PMJDY). 
     
    As on March 2019, there were 57.3 crore BSBD accounts across the country, including 35.27 crore Jan Dhan accounts. There are no charges for not maintaining minimum balance for these accounts. BSBD accounts provide certain basic minimum facilities free of charge. For accounts other than BSBD accounts, as per RBI’s Master Circular on “Customer Service in Banks” dated July 1, 2015, banks are permitted to fix service charges on various services rendered by them, as per their Board approved policy, while ensuring that the charges are reasonable and not out of line with the average cost of providing these services. 
     
    As apprised by eighteen Public Sector Banks (PSBs), the amount collected through the levy of charges for non-maintenance of minimum balance in Savings Bank account, during the last three financial years, are as under: 
     
     
    This information was shared by the Minister of State in the Ministry of Finance Mr Anurag Thakur who was replying to an unstarred question asked by Shri Vasanthakumar H. in the Lok Sabha whether the ministry is aware that due to economy slowdown customers and firms failing to meet the Average Monthly Balance (AMB) requirements in a month have to bear penalty charges, if so, the details thereof including the average income through this penalty by the banks for the last three years area-wise like metro/urban/semi-urban/grameen. 
     
    NPAs have declined by Rs. 97,996 crore to Rs. 9,38,191 crore as on 30.6.2019 from Rs. 10,36,187 crore as on 31.3.2018. This information was shared by MoS Finance Anurag Thakur was responding to Congress MP Deepak Baij's query on the details of the amount of NPAs of various banks written off during the last five years and its impact on the Indian economy. Mr. Thakur added that the gross NPAs stood at Rs 3,23,464 crore on March 31, 2015 and increased to over Rs. 10,36,187 crore by the end of FY 2017-18 on March 31. 
     
    As per data of the Reserve Bank of India (RBI), aggregate gross advances of Scheduled Commercial Banks (SCBs) in their global operations increased from Rs. 25,03,431 crore as on 31.3.2008 to Rs. 68,75,748 crore as on 31.3.2014. As per RBI inputs, the primary reasons for the spurt in stressed assets have been observed to be, inter-alia, aggressive lending practices, wilful default / loan frauds /corruption in some cases, and economic slowdown. Asset Quality Review (AQR) initiated in 2015 for clean and fully provisioned bank balance sheets revealed high incidence of Non Performing Assets (NPAs). 
     
    As a result of AQR and subsequent transparent recognition by banks, stressed accounts were reclassified as NPAs and expected losses on stressed loans, not provided for earlier under flexibility given to restructured loans, were provided for. Further, all such schemes for restructuring stressed loans were withdrawn. Primarily as a result of transparent recognition of stressed assets as NPAs, gross NPAs of SCBs, as per RBI data on global operations, rose from Rs. 3,23,464 crore as on 31.3.2015, to Rs. 10,36,187 crore as on 31.3.2018.
     
    As per RBI guidelines and policy approved by bank Boards, non-performing loans, including those in respect of which full provisioning has been made on completion of four years, are removed from the balance-sheet of the bank concerned by way of write-off. 
     
    Banks evaluate/consider the impact of write-offs as part of their regular exercise to clean up their balance-sheet, avail of tax benefit and optimise capital, in accordance with RBI guidelines and policy approved by their Boards. 
     
    Banks claim that the recovery measures continue even after write-offs. Bank-wise details of NPAs written-off by SCBs for the last five financial years are at Annexure 1.The Gross Domestic Produce for the Indian economy has grown at an average annual growth rate of 7.5% over the last five years, with growth rate of 6.8% (provisional estimates) in the financial year 2018-19, enabled by growth in gross advances of SCBs of an average of 9.3% over the last five years and growth of 13.3% in the financial year 2018-19. Details in this respect are at Annexure 2.
     
     
     
    As per RBI data, the details of loans of SCBs in their global operations that were written-off and pertain to “Agriculture and allied activities” and “Services—Trade” are at Annexure 3.
     
     
    As per the list provided in Lok Sabha as response to unstarred question no. 1285, regarding writing off bank NPAs, the State Bank of India wrote off Rs 56,481 crore in FY 2018-19.
     
    Other major banks which wrote off large amounts in FY2018-19 include IDBI Bank Ltd (Rs 14,166 crore), Canara Bank (Rs 13,849 crore), Bank of Baroda (Rs 11,725 crore), Central Bank of India (Rs 10,375 crore) and Punjab National Bank (Rs 11,238 crore).
     
    The NPA write-offs of banks such as Axis Bank, Bank of India, Bank of Maharashtra, Corporation Bank, Dena Bank, HDFC Bank, ICICI Bank, Oriental Bank of Commerce, Syndicate Bank, Union Bank of India and United Bank of India ranged between Rs 4,000 crore and Rs 10,000 crore in FY 2018-19.
     
  • Like this story? Get our top stories by email.

    User

    PMC Bank Fraud: Probe Finds Abchal Group as Another Ghost Account Operator, says Report
    Investigation into the Punjab and Maharashtra Cooperative (PMC) Bank fraud have revealed another borrower — the Abchal Group — that concealed its identity through password-protected accounts, much in the manner of Housing Development and Infrastructure Ltd (HDIL), says a report.
     
    According to the report in Economic Times, these accounts allegedly belonged to the Abchal Group, loans to which have turned bad, saddling the PMC Bank with a liability of Rs300 crore. Not much information seems to be publicly available on the Abchal Group or its promoters.
     
    Quoting sources, the report says, these ‘ghost accounts’ are suspected to have been operated by entities with the knowledge of arrested bank officials. 
     
    According to details available with registrar of companies (RoC), Shri Abchal Property Investment Pvt Ltd was incorporated in 1992 with a share capital of Rs1 lakh, the report added. 
     
    Earlier this week, the Reserve Bank of India (RBI) had said that PMC Bank had submitted fraudulently manipulated data to the central bank for sample checks, but the sample of accounts picked for inspection did not contain undisclosed accounts of HDIL group companies.
     
    In its affidavit submitted to the Bombay High Court, the central bank says, "The disclosed HDIL related accounts were seen and majority of them were assessed as non-performing assets (NPAs). Further non-monitoring of end use of funds and conflict of interest of Waryam Singh as chairman of PMC Bank and as a former director of HDIL group was also commented upon in the report along with the attempt by the bank to show disclosed accounts of HDIL group as standard by sanction of new loans to close or regularise the old NPA accounts... Consequently, the assessed NPAs of the Bank were significantly higher than the reported NPAs."
     
    "The Bank had also sanctioned mortgage overdraft limits to a wholly-owned subsidiary of the HDIL while the present (now arrested Waryam Singh) chairman of PMC Bank, was also a director of the company -- a clear conflict of interests and violation of the RBI's Master Circulars... Waryam Singh also chaired a PMC Bank board meeting to ratify the approval of mortgage overdraft in which he was directly interested, again contravening RBI norms."
     
    "The inspection team had also established the relationship between the chairman of the Bank and HDIL promoters, which might have acted as the primary consideration for sanction of credit facilities and resulted in their utilisation to pay off one-time settlement dues with other landers," RBI had said.
     
    Detailing the "modus operandi of hiding the information related to HDIL exposure" employed by the PMC Bank, the RBI affidavit says they (Bank executives) tampered with management information systems and NPC identification process. In this, the Bank had given special access codes on Finnacle, its core banking software (CBS) for HDIL accounts with restricted visibility to less than 25 out of PMC Bank's 1,800 staffers.
     
    RBI says, "While running the script for system identification of the NPAs, it deliberately excluded the HDIL accounts which were thus omitted from the system generated reports of NPA accounts, and ditto with the overdrawn accounts list.
     
    The PMC Bank's own MIS software called 'Opine' had a script for generating lists of newly sanctioned or disbursed accounts, but the undisclosed loan accounts were excluded from this list."
     
    "These irregularities were not highlighted by the PMC Bank's concurrent auditors at the Sion Branch, where all these undisclosed accounts were parked though concurrent audits were carried out every month," the affidavit pointed out.
     
    You may also want to read our detailed coverage on PMC Bank… 
     
  • Like this story? Get our top stories by email.

    User

    COMMENTS

    Nakul Kumar Reddy

    3 weeks ago

    PMC bank management r by born cheater's,they need only money ,no values nothing.
    They born for loot public money

    We are listening!

    Solve the equation and enter in the Captcha field.
      Loading...
    Close

    To continue


    Please
    Sign Up or Sign In
    with

    Email
    Close

    To continue


    Please
    Sign Up or Sign In
    with

    Email

    BUY NOW

    online financial advisory
    Pathbreakers
    Pathbreakers 1 & Pathbreakers 2 contain deep insights, unknown facts and captivating events in the life of 51 top achievers, in their own words.
    online financia advisory
    The Scam
    24 Year Of The Scam: The Perennial Bestseller, reads like a Thriller!
    Moneylife Online Magazine
    Fiercely independent and pro-consumer information on personal finance
    financial magazines online
    Stockletters in 3 Flavours
    Outstanding research that beats mutual funds year after year
    financial magazines in india
    MAS: Complete Online Financial Advisory
    (Includes Moneylife Online Magazine)
    FREE: Your Complete Family Record Book
    Keep all the Personal and Financial Details of You & Your Family. In One Place So That`s Its Easy for Anyone to Find Anytime
    We promise not to share your email id with anyone