Money & Banking

Business as usual, says Syndicate Bank

| Updated on: Aug 06, 2014

RBI audit as per AFI norms


Syndicate Bank on Wednesday maintained that its business was "normal" and said the audit being undertaken by the Reserve Bank of India (RBI) was an annual exercise as per the annual financial inspection (AFI) norms.

Syndicate Bank has recently been in the limelight for the wrong reasons after its Chairman and Managing Director Sudhir Kumar Jain was caught by the Central Bureau of Investigation (CBI) for allegedly taking Rs 50 lakh bribe to enhance the credit limit for steel companies -- Bhushan Steel and Prakash Industries. Jain was suspended by the Government on Monday and two executive directors - M Anjaneya Prasad and T.K.Srivastava -- have been given the interim charge of the bank.

"There is absolutely no problem. We have had a review meeting and everything is going on as usual. We have been getting deposits and the deployment of funds is healthy" Anjaneya Prasad, Executive Director, Syndicate Bank told reporters on the sidelines of the State Levels Bankers Committee.

"The 89-year old bank has got highest reputation. Whatever has happened is not an internal fraud has happened," Prasad said. On the inspection of the bank's books by RBI, Prasad said the audit was an annual exercise and was going as per the AFI norms. "The audit has started 15-20 days back," he added.

On Tuesday, RBI Governor Raghuram Rajan had said there was a need to look again at the governance of public sector banks and understand the deficiencies to improve them.

Replying to a query on the dent on bank's image, T.K. Srivastava, Executive Director, Syndicate Bank said "It is the individual's (Jain's) image has taken hit and not that of the bank". Srivastava clarified that Bhushan Steel was not declared a non performing asset (NPA) and that it was a standard account of the bank since 2004. He further said that Syndicate Bank, which is part of the SBI-led 20-bank consortium, had an exposure of less than Rs 1,500 crore to Bhushan Steel.

Syndicate Bank shares ended 2.37 per cent lower at Rs 132 on Wednesday.

Published on August 06, 2014

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