The Hindu Business Line : Marginal exposure, say Satyam bankers

Hyderabad, Jan. 7 Even as official bankers to the beleaguered Satyam Computer Services are busy checking their books for exposure, the other are relieved that they did not have anything to do with it.

Satyam names six banks as its official bankers – Bank of Baroda, BNP Paribas, Citibank N.A., HDFC Bank, HSBC Bank and ICICI Bank.

“ICICI Bank has no fund-based or non-fund based exposure in Satyam Computer Services (Satyam), other than a marginal exposure of about Rs. 3 crore on account of a forward contract,” an ICICI official told Business Line from Mumbai. “Satyam has a deposit with ICICI Bank in a current account. The balance in this account is not material,” he added.

HDFC Bank has some contracts related to remittances with Satyam and also manages the salary accounts of the Hyderabad-based company, according to an official. It had also extended some auto loans to Satyam employees. “However, the exposure is 100 per cent insignificant,” he said.

While HSBC chose not to comment on the issue, efforts to reach the remaining banks were not successful.

For many other banks, the Satyam developments are shocking.

“Fortunately most banks are devoid of any serious exposure to Satyam, not by design but by default. We would not have had any doubts over its credibility if it had approached us for loans,” the Chairman and Managing Director of a public sector bank told BusinessLine.

It was shocking how it cleared auditing and managed to get good ratings, he added.

Retail loans

The 53,000 employees of Satyam may now find it difficult to access retail loans. According to sources, many banks have already placed them in the high-risk category as several questions loom large over the future of jobs/company.

In the case of existing loans, banks are keeping their fingers crossed. “Till date, the track record of the loan repayments from Satyamites had been highly satisfactory and we don’t speculate on future,” said an HDFC official.

According to ICICI Bank, there is no move to mix corporate issues with personal creditworthiness of the employees. The sanction of loans would depend on standardised due diligence (in which the job-safety is also a part), its official said.

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