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C.R. Sukumar

"The bank has repaid deposits to the tune of Rs 66 crore and currently has Rs 105 crore in cash."

Hyderabad , Dec. 8

THE Prudential Bank Employees Union has urged the Government and Reserve Bank of India to allow them to run the bank and revive it over the next couple of years.

The Union has sited the sizeable recoveries of Rs 187 crore made during the last two years as proof of their capabilities.

The Union General Secretary, Mr B. George Reddy, told Business Line that bank is now on a recovery path with the sincere efforts of the employees, who have not only foregone their allowances and salaries to the extent of 40 per cent but also gone in for aggressive recoveries while meeting the expenses through their contributions.

According to him, the bank has successfully repaid deposits of Rs 66 crore to the depositors and currently has cash to the tune of Rs 105 crore. While the amount recoverable stands at Rs 532 crore, the bank still needs to repay Rs 275 crore of deposits. The large defaulters alone, numbering around 25, account for around Rs 300 crore of NPAs.

Finding the decision of RBI to cancel the bank's licence as unwarranted, he said the bank is a viable entity and has good potential for takeover, merger and other rehabilitation packages. The revival of the bank can be expedited by introducing further concessions to borrowers who were willing to clear their dues, he said.

While urging the Government not to implement retirement of staff without any compensation, Mr Reddy advised running the bank under the RCS (Registrar of Cooperative Societies) purview and assured total cooperation of the employees for the early revival of the bank.

The management of the bank, currently working under the supervision of the RCS, has also opposed the RBI's move to cancel the bank's licence. Responding to the show-cause notice served by the RBI during the first week of October, the Prudential Bank Managing Director, Mr C. Sambaiah, submitted to the apex bank that with the recovery of NPAs, the financial position of Prudential Bank would improve and it was possible to revive the bank by way of implementing reconstruction package.

Further, opposing the move of RBI to cancel the licence, the Managing Director said the bank has been successfully making recoveries with the support of its team of employees.

"The strength of the team now working from April 2003 is the good recovery of bad debts in this bank. By December 2003, Rs 97 crore were recovered. By March 2004, the recovery was Rs 136 crore and by June 2004, the recovery figure went up to Rs 160 crore. This is now around Rs 180 crore. ," he said.

The Managing Director of Prudential Bank MD submitted to the RBI that the bank has got tremendous potential for sustenance and growth with its revival.

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