Comments
The All India Bank Officers' Association has sent an SoS to the President of India praying for his immediate intervention to save the Indian banking system from further collapse and for restoring the health of the banking industry.
Banking audit commission
Voicing concern over the rising incidence of bad loans in the banking system, AIBOA General Secretary S Nagarajan has in the communication stressed the need for a 'Banking Audit Commission' on the lines of CAG (Comptroller and Auditor General of India) for the entire banking system.
The association has suggested the need for entrusting the responsibility of auditing the accounts of public sector banks to an external authority/ committee with members of proven integrity and moral standing.
"This audit should be done for the just-ended fiscal and within a fixed time schedule. The report should be submitted to the President,'' Nagarajan told Business Line , adding 'the mess in which we are today is not because of something that has happened in the recent past. It started in the early 90s.''
"The Chairmen, who were responsible for conduct of affairs since 1993, and due to which the present has arisen should be made accountable,'' he said.
Large loan proposals
Large loan proposals are at present considered by a committee consisting of general manager's of the bank.
Endorsing the RBI's observation on committee method of sanctioning loans, the association has sought to make every member of the committee accountable together with the Chairman, the Government representative and the RBI representative for their failure to check the deviation during their tenure and as a result of which such sanctions had turned out to be bad.
Urgent steps need to be taken to declare defaulters with sufficient resources to clear their bank dues as "wilful defaulters under criminal procedure code'', the AIBOA General Secretary said, seeking an amendment to the definition of "wilful defaulters'' to include diversion of bank funds for acts other than the one for which it was availed.
Amendment to company law
The association has also sought suitable amendment to the Company Law such that the CEO or promotee director of the defaulting company cannot be made director of any other company..
The People's Representation Act 1951, should prohibit bank loan defaulters from contesting in the election, at any level, the association said.
Sharing bank-wise details of bad loans and the amounts written off by the banking system year-after-year since 2007, Nagarajan appealed to the President to urge the Indian Banks' Association to publish the caution list on a bi-monthly basis for the benefit of member banks.
On a parting note, he said: "We can't afford to let this go lightly any more.''
Comments
COMMENT NOW
Comments
Comments have to be in English, and in full sentences. They cannot be abusive or personal. Please abide by our community guidelines for posting your comments.
We have migrated to a new commenting platform. If you are already a registered user of TheHindu Businessline and logged in, you may continue to engage with our articles. If you do not have an account please register and login to post comments. Users can access their older comments by logging into their accounts on Vuukle.