The All India Bank Employees Association (AIBEA) has hit out at the moratorium imposed on Lakshmi Vilas Bank. The General Secretary of the Association, C.H, Venkatachalam has questioned the bad loans of more than Rs. 2000 crores to borrowers like Religare, Jet Airways, Cox and Kings, Nirav Modi group, Coffee Day, Reliance Housing Finance, etc. The press release issued by the All India Bank Employees Association (AIBEA) is published below for the benefit of the viewers of www.indianpsu.com
By C.H. VENKATACHALAM, GEN SECRETARY, ALL INDIA BANK EMPLOYEES ASSOCIATION
• RBI’S INACTION RESULTS IN MORATORIUM ON LAKSHMI VILAS BANK
• WE DEMAND A THOROUGH PROBE INTO THE CULPABILITY OF RBI
• TAKE ACTION ON THOSE LVB OFFICIALS WHO MISMANAGED THE BANK
• AIBEA DEMANDS GOVT. TO MERGE LVB WITH A PUBLIC SECTOR BANK
For the past three years and more, the Tamilnadu based private sector Lakshmi Vilas Bank has not been in good health, rather, it was suffering from bad health and continuous loss. The reason is well known to all including RBI. The then management of the Bank had indulged in a lot of bad loans of more than Rs. 2000 crores to borrowers like Religare, Jet Airways, Cox and Kings, Nirav Modi group, Coffee Day, Reliance Housing Finance, etc. All these undesirable loans were known to RBI as it had its nominee as Director on the Board of the Bank. The Bank was put of PCA norms indicating that the Bank needs correction. But unfortunately a very long rope has been given to the Bank and today, the RBI has announced moratorium.
From AIBEA we have been demanding timely action by RBI on the deteriorating health of LVB and LVB to be merged with a Public sector Banks. Such a pro-active action was not taken.
Now this announcement has come as a shock to the bank customers and general public. This will create panic and doubt in the minds of people about the stability and dependability of Banks because people keep their hard- earned savings in the Banks.
RBI which is responsible to maintain the stability of the banks and financial sector cannot escape its responsibility for not taking timely action. RBI’s role should be thoroughly probed.
Moreover, some top management officials of LVB are responsible for the huge bad loans in the Bank and action should be taken on them.