Year Round Up: Banks Chase Borrowers In 2014 To Recover Loans

Tuesday, December 30, 2014
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NEW DELHI: Burdened with rising bad loans, mostly given to big corporates, banks learnt it hard way in 2014 that 'if you owe the bank 100 dollars that's your problem, but if you owe the bank 100 million dollars, that is the bank's problem'.

This was stated by legendary American industrialist J Paul Getty - the world's richest private citizen till his death in 1976 - but his words appeared perfectly apt decades later in 2014 for the Indian banking industry, which also had to fight corruption, 'cash-for-loan' scams and irregularities in the appointment of top executives at state-run lenders.

However, it was loans given to big corporates turning bad that kept the banks on their toes and even extreme efforts like declaring the borrowers as 'wilful defaulters' could not yield desired results amid various roadblocks.

As banks were grappling with non-performing loan problem, the CBI arrested six persons, including chairman and managing director of Syndicate Bank S K Jain for allegedly taking a bribe of Rs 50 lakh for increasing credit limit of some companies in violation of banking rules.

CBI alleged that the conduit was the brother-in-law of the CMD and the deal was struck by the chartered accountant who has started his own firm of providing loans to big corporate houses.

The investigative agency claimed to have recovered cash to the tune of Rs 21 lakh from Jain's residence besides gold worth Rs 1.68 crore and fixed deposits upto Rs 63 lakh.

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Source: PTI

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