In a letter addressed to the chief election commissioner, VS Sampath, the bank union has demanded that defaulters should be disqualified from contesting elections in a bid to tackle rising bad loans
Trithesh Nandan | March 21, 2014
As public sector banks continue to be burdened by ballooning non-performing assets (NPAs), one of the bank unions has aggressively gone against bank defaulters who are likely to contest general elections.
The Chennai-headquartered All India Bank Employees’ Association (AIBEA) has demanded in a letter to the election commission (EC) that loan defaulters should not be allowed to contest the 2014 general elections held in April and May. “The nominations of candidates who are loan defaulters in banks should be rejected,” said AIBEA, the body representing clerical and subordinate staff from various public sector banks. The letter was addressed to VS Sampath, chief election commissioner (CEC), demanding action against such individuals.
"We have alerted this issue to the CEC before elections. Drawing attention on this issue is very important as some of these defaulters are holding high positions," said DD Rustogi, joint secretary of AIBEA. "Such candidates, owing big loans to banks and defaulting on it, should be debarred from contesting elections. If you fix accountability at the time of elections, it will give a stern message to others too," he added.
"One of the borrower companies in which a central minister is directly connected is also a defaulter to the tune of Rs 350 crore. Two top loan defaulters are Padma Shri awardees and owe Rs 930 cores and Rs 580 crores respectively to banks. Another top defaulter is a member of the Rajya Sabha who is yet to repay loans over Rs 6000 crore," the AIBEA letter said. The AIBEA had made public 50 top defaulters in December where the now-grounded Kingfisher airlines (with an outstanding figure of Rs 2673 crore) topped the list. The airline company’s chairman Vijay Mallya is a member of the upper house.
The AIBEA said by March 2013, bank NPAs have amounted to Rs 1,64,461 crore. The fresh bad loans in the last four years have gone up to Rs 3,15,465 crore. (A loan is classified as an NPA when a borrower is not meeting its principal and interest payments on loan received by lenders. If the amount is overdue for 90 days in case of commercial loans, and 180 days for consumer loans, it becomes an NPA.)
The union has also demanded disqualification of such members of parliament (MPs) who are defaulters. "The rules regarding disqualification as provided in the Constitution and Representation of People Act, 1951 should be suitably amended for this purpose," said one of the demands of the AIBEA.
"We have received a letter from the bank union," said Rajesh Malhotra, director media & communication of the election commission but did not specify the steps that the commission will take in the matter.
The dazzling diamond trade has been hit hard by the Nirav Modi episode, which saw the billionaire jeweller flee India just before a massive fraud amounting to Rs 11,000 crore was detected at a Punjab National Bank branch in Mumbai. But, Nirav Modi is not the only diamond tycoon who has been
PM Narendra Modi on Sunday laid the foundation stone for Rs 16,700 crore Navi Mumbai International Airport. The first phase of the construction is expected to be completed by December 2019. The project is going to be implemented 21 years after it was first proposed. The airport is likely to handle 10 milli
Health groups have expressed their disappointment with a February 12 order of the supreme court, refusing to review or recall an earlier order disposing off a case against the mala fide suspension of the vaccine public sector units (PSUs) and government’s tendency to pamper private sector with public
The Punjab National Bank`s fraudulent transactions worth Rs 11,300 crore should act as a strong trigger for the government for reducing its stake to less than 50 percent in the banks which should then be allowed to work on the lines of private sector lenders with a full sense of accountability to their sha
Budget 2018, forecast to be a “please all” budget, has come out as a “disappoint all” budget. The public is looking askance at a budget that gives with one hand but takes away with both, the Sensex has gone into a tailspin and the pink papers are issuing dire warnings.
Should public sector banks be privatised?