Two Padma Awardees in Top Defaulters' List Says Bank Union

Alleging "an unholy nexus" between borrowers, politicians, bureaucrats and top managements of lenders, a bank employees union today said two Padma awardees also feature in the list of top loan defaulters.
     
"There is an unholy nexus between borrowers, politicians, banks' top officials and bureaucrats, which results in compromises on asset quality. This list of the biggest defaulters compiled by RBI also features two Padma awardees," All-India Bank Employees Association vice-president Vishwas Utagi said.
     
The Padma awards are amongst the country's top most civilian honours.
     
Utagi said the document, culled out by the union, has been sent by the RBI to bank managements in order to prevent further defaults.
     
Utagi also said top 400 loan defaulters collectively owe over Rs 70,000 crore to banks as of March 31, 2013.
     
This includes a Delhi-based company with a default of Rs 581.61 crore.
     
The union leader also alleged another company owed Rs 938.48 crore to lenders like Canara Bank, State Bank of Hyderabad, State Bank of Travancore, Andhra Bank, Union Bank of India, Allahabad Bank and Indian Bank.
     
Claiming that this a confidential list which has been picked up by employees from RBI's communication to banks, Utagi demanded that banks make their list of defaulters public as it involves the loss of depositors' money.

Alleging that many of the defaults are wilful, the union demanded changes in the statutes to make such defaults a cognisable offence and criminal prosecution of those who have colluded before a loan goes bad.

Utagi also said banks should also not enter into any "compromise" routes like the sell-off of an asset to an asset reconstruction company or using the debt recovery tribunals to recover the money, but should rather focus on recovery.