Mohan’s Musings
The Great Banks Robbery for which NOBODY will be punished.
I am being ripped off. And I am not the only one. Everyone of you who has an account in any bank is the victim of this great robbery. The amount is Rs 1.10 lakh crore. It is my money. It is your money. But the banks have lent it to big borrowers without proper scrutinies, without proper checks, without mortgaging assets, without proper collaterals and without verifying the authenticity of their claims, the papers and certificates submitted by them.
And that entire amount has been written off.
My questions:
Have they seized or tried to seize the assets of the managing directors, chairmans, directors and major stake holders?
Have they taken over the assets of the sureties and signatories?
Has there been an auction of the apartments, properties and vehicles owned by them?
Have the banks got the accounts of these people frozen?
Have the bank officials who sanctioned these loans been hauled up, questioned, suspended and charged?
Have the names of the people who conned banks been disclosed to public?
Has a single MD or Chairman moved in the house of a friend or in-laws because his apartment / bungalow has been seized?
The answer to every question I raise is ‘no’.
How the banks loot us.
Despite RBI controls, most banks take full advantage of the monopoly like situation. It is like a cartel.
Take for instance:
1. While it take a bank clerk the same five minutes to prepare a pay order, and when the money is ours, the charges change with the amount. A pay order for Rs 50 lakhs may cost you Rs 15,000. Plain robbery. Even the Shikarpuris issuing hawala chits charged less.
2. Banks use buying and selling of foreign currency as a business like the money changers. Why they charge any arbitrary charges without any value addition to the transaction.
3. Many private banks have different rates for RTGS (Real time gross settlement) depending on the quantum of money being transferred. It doesn’t take longer to punch in a transfer entry of Rs.1 crore as compared to a transfer entry of Rs.3 lakhs. If RTGS has to replace cheques it should be free or close to free.
The banks may call it business, I call it unethical business.
Moreover, there is a lot of difference in treatment to a ‘small’ borrower and the ‘big’ borrower.. The banks can easily get a car picked up if a certain number of EMIs are not paid, may embarrass a middle class borrower and recover the loan yet they make it more difficult for him to borrow than for a big borrower. Yet, it treats the small borrower as of no consequence. The pygmy sitting behind the desk with some fancy label, would look down at the person applying for loan like some needless chore. His documents are scrutinised, salary slip is checked and a bank representative would visit the house, check the credit worthiness and all the bank statements, deposit receipts etc
The small borrower is made to feel, well, small!
There are scores of instance. The govt can make a law and impose a fine of Rs 1000 for charging more than MRP on the mineral water, for breaking a signal and for several small offences of the common citizen, the small man. But the banking lobby is too powerful for the government.
The banks often sanction loans of unusually large amount for the corporates without proper security, over-valuation of the assets (as happened with Vijay Mallya) and by ignoring the usual safety norms before parting with the funds.Those amounts are in hundreds and thousands of crore.
It is not unreasonable to assume that cuts and commissions reach to the highest echelons of the corridors of every bank which ‘lends’ such massive amounts.
It is not difficult to understand why these huge loans are written off without much effort to recover them. Just compare the wide coverage the media gave to a single defaulter called Vijay Mallya who was hounded for an amount of Rs 8000 crore and has absconded to London. Even as the banks try to auction his bungalows, fleet of expensive luxury cars and personal jet, we learn that everything was overvalued. The banks will find it difficult to recover even half of the amount loaned to him, forget the interest and penalty. But this amount is peanuts compared to Rs 1.10 lakh crore the others have borrowed and swallowed.
Using the banking jargon, the banks hide behind phrases like ‘settlement of NPAs is a time consuming process’, ‘involves labour’ and ‘judicial process’ and opt for write-off. Simply put, the banks say that they don’t have staff and legal advice to recover the money! What they are trying to underplay is that the money has been squandered or siphoned out and the assets pawned by the corporates are not worth the valuation.
The blame lies at the door of the banks and their staff (and outsiders) who over-valued the assets. And if the bank officers are whispering that they passed huge loans under pressure from the politicians, let them name them!
Let us know how much loan was approved under the pressure from UPA2 and how much loan was sanctioned under the unsaid orders of BJP government.
And let’s have the names.
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