Sunday, December 11, 2011

FM build pressure on Bankers to Hasten Bad loan recovery

This refers to article published on front page Today 13th December 2011 in Economic Times captioned as “Finmin Pressure on PSBs to hasten bad loan recovery”

Sau Chuhe mar kar Bill Haz ko Chali is an old proverb which fits perfectly to define the leadership of Pranab Mukherjee, the learned Finance Minister. During last two decades Non Performing assets in Public sector banks have gone up from a few thousand crores to two lac crores of rupees.

Bankers together with politicians have already caused much damage to health of banks. I have written several letters and submitted many blogs on this issue at various forums but none in government circle or in RBI is so much worried. My blog submitted through will tell the true story of banks in public sector. Corruption at all levels is the root cause of all maladies prevalent in Public sector banks and I still doubt the efficiency and sincerity of top banks and politicians. I do not hope that they will do what they say.

Flattery and flattery and Flattery, they like flattery and bribery only. Bribe and costly gifts are necessary to get promotion and good posting. Big corporate and trade houses who seek high value loans from banks have to pay costly gifts and high value bribe to bankers and then through them to politicians to survive. Some of these loans eventually become bad and some of them are provided debt relief and some of them are waived or written off..ED and CMD who loiter in the office of Ministry of Finance and RBI do so only to ensure perfect setting for their promotion by paying lacs of rupees and in turn they repeat the story in their banks. Who will save the banks is million dollar question. By the time malady surfaces, top bankers get safe exit and politicians also change colours.

It is ironical that in our country, such politicians, ministers and VIPs are given police protection, are provided black commandos and are given all comfort level on safety and security who has nothing to lose. Bankers who are handling about 80 Trillion of rupees as deposit and who have lent as much as 50 trillion of rupees are provided no safety. Bankers become helpless when the loans become bad for recovery. They have to beg from pillar to post in various courts for years and decades to obtain decree and to ensure execution of decree from the administrative machinery.

Police forces are more concerned for safety of petty politicians and least for bankers. It is funny that bankers who are handling finance matters in trillions and who have to deal with crores of customers have to manage their affairs at their own, apply their own tact and ultimately leave the matter on Bhagwan Bharose.

Every Tom, Dick and Harry knows in Finance Ministry, in Banking Division, in RBI and in Bank management realizes the weakness of the system but none dares to take real corrective step. Everyone preaches sermon to other but none is serious. Finance Minister preaches sermon to ED and CMD of banks, CMD and ED to General Managers, GM to his subordinate and so on. But in field they act opposite to what they preach.

For last three decades, bankers and politicians are blaming each other and both are promising for improvement but the fact is that situation is moving from bad to worse, worse to worst. Cases lodged in DRT should be decided in 6 months but not decided in even 6 years. Cases lodged in state level offices of Certificate Officers should be decided in 30 days but not decided in 30 years.

I am pleased now that Finance Minister has now advised banks to hasten bad loan recovery. I request learned FM to first bring about necessary improvement in working style of Debt Recovery Tribunals, High courts and Supreme courts where lacs of cases are pending for years together. He should build pressure on state government to ensure timely and quick decision in the office of Certificate officers and that of courts at district level. Lastly he has to support Team Anna to eradicate Corruption from all these offices and judiciary because due to bribery culture prevalent in these places , cases are either rejected or kept in abeyance or dates are given on some plea of the other.

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