Money & Banking

Officers’ organisations demand judicial probe

Our Bureau Mumbai | Updated on November 26, 2020 Published on November 26, 2020

The four officers’ organisations representing the entire banking industry have denounced the acquisition of Lakshmi Vilas Bank (LVB) by DBS India Ltd (DBIL) and demanded a judicial probe into the entire process.

DBIL is the Indian subsidiary of the Singapore-based DBS.

The organisations,in a joint statement, said: “It is a matter of concern how a bank of the stature of LVB having a glorious history of 94 years...could be handed over to the DBS on a platter against an investment of ₹2,500 crore only.”

The four organisations are — All India Bank Officers’ Confederation, All India Bank Officers’ Association, Indian National Bank Officers’ Congress, and National Organisation of Bank Officers.

LVB had 563 branches, around 4,300 employees and 974 ATMs having gross advances of ₹16,622 crore and ₹20,973 crore in deposits as on September-end 2020.

“It is also intriguing that RBI had earlier disallowed a merger between LVB and Indiabulls (Housing Finance). Further, in the none too distant past, an offer by DBS to buy a 50 per cent stake in LVB was turned down. We are deeply concerned whether fair valuation of the bank and due diligence has been carried out. We are of the considered opinion that LVB is being handed over to DBS at a much depressed value, which one-sidedly benefits DBS,” according to the statement.

The Union Government and RBI must clarify on what ground/ grounds a private bank, which has been under stress, is being handed over to a foreign bank for the first time in the post-independence period, it added.

“We, therefore, demand a judicial probe into the entire process and demand that till the facts are disclosed and justified, the acquisition of LVB to be stalled forthwith,” the statement said.

The four officers’ organisations, through their joint statement, condemned the decision of the Union Cabinet to approve the amalgamation of LVB with DBIL and subsequent notification by RBI, without addressing the concerns that were raised by them in a communiqué addressed to RBI Governor dated November 20.

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Published on November 26, 2020
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