IDBI Bank has disclosed that pisciculture loans aggregating ₹772 crore, which were sanctioned from FY 2009 to FY 2013 at a few of its branches in the undivided State of Andhra Pradesh, were fraudulently obtained by some industrialists, who stood as common guarantors for these loans.

The bank said the industrialists, referred to as ‘Aggregators’, submitted fake lease documents of non-existent fish ponds. Further, the empanelled valuers also inflated the value of the collateral securities. There were 52 Aggregators with a principal outstanding of ₹772 crore.

While recovery was achieved in certain accounts, most of the accounts turned non-performing from FY14 onwards, the bank said in a statement to the exchanges.

After the loans were sanctioned, they were parked in five branches — Basheerbagh in Hyderabad, Guntur, Rajahmundry, Bhimavaram and Palangi. “It was also observed while conducting Staff Accountability exercise that there were major lapses while processing and disbursing the loans, mainly in respect of Battu Rama Rao, General Manager and R Damodaran, ex-Chief General Manager,” it said. “Accordingly, Rama Rao has been dismissed from service while Damodaran had already retired. Thereafter, the bank filed five separate complaints with CBI (Central Bureau of Investigation) for further investigation in respect of the cases dealt in the five branches,” it added.

CBI registers two cases

The CBI recently registered cases for two of the five complaints filed in respect of the branches at Basheerbagh and Guntur.

The IDBI Bank statement said the CBI is, however, yet to register cases filed in respect of the remaining three branches, at Rajahmundry, Bhimavaram and Palangi.

The bank said it has already provided for these loans to the extent of 100 per cent and hence, there is no further impact of these accounts on its profitability/balance sheet. IDBI Bank added that it continues to pursue all legal actions to recover the dues from these borrowers.

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