Defaulters list of 3 banks out

Defaulters list of 3 banks out
ENS ECONOMIC BUREAU

CALCUTTA, DEC 25: The Bank Employees' Federation of India (BEFI) on Friday released the names of major defaulters owing money to United Bank of India, Uco Bank and Indian Bank among others. BEFI general secretary S Bardhan told reporters that closure of weak banks suggested by the CII task force "will have no desirable impact on the NPA of the banking industry - rather it will provide unwarranted shelter to those who are responsible for creating NPAs and encourage dishonest business houses to borrow and default on repayment."

The amount outstanding in the top 100 NPA accounts of UBI on March 31, 1999 was Rs 542 crore which included Rs 12.26 crore due from Dunlop, Rs 20 crore from Jugantar/Amrita Bazar Patrika group, Rs 42.4 crore from BTW Industries, Rs 30.45 crore from IG Petro, Rs 21.65 crore from Ratan Exports, among others.

On the other hand, NPAs in the top 137 accounts of Uco Bank amounted to Rs 598 crore on March 31, 1999. It included Rs 58 crore from Premier Cables, Rs 38 crore from Allied Resins, Rs 25 crore from Bihar Sponge, among others. The Chhabria group companies together owe Rs 58.08 crore to the Allahabad Bank and Canara Bank, Bardhan said. The MP Poddar group companies - Nuddea Jute, Gouripore Jute and Konarak Paper - owed Rs 52.37 crore to UBI and Punjab National Bank. Besides, HMP Cement and HMP Sugar of the HMP group owe another Rs 27 crore to the Indian Bank, he added.

BEFI has requested the central government to make a public announcement that it categorically rejects the CII recommendations, to direct the public sector banks to publish the names of major defaulters and to transfer some good government accounts from financially sound banks to weaker banks like Uco, UBI and Indian Bank.

It may be recalled that last Sunday, after bank unions threatened to expose its members who were huge defaulters, CII had asked the government not to consider this suggestion. Later its president Rahul Bajaj told PTI that CII stood by its earlier recommendation to close the banks. This was followed by a CII disclaimer saying Rahul Bajaj had been misquoted by PTI and that he stood by the CII stand that the closure recommendation stood withdrawn.

Bajaj had added that he was also in favour of disclosure of the list of corporate defaulters. Bajaj emphasised that CII stood by the recommendations made by its National Task Force (NTF) on non-performing assets headed by K V Kamath, managing director of ICICI, even though CII secretary general Tarun Das had last Sunday stated that ``CII is recommending to the government not to consider the proposal relating to closure of banks.'' ``NTF's suggestion for closure of the three weak banks Indian bank, United Bank and UCO Bank is only recommendatory in nature and unfortunately only this point got highlighted among the 26 other recommendations made by it,'' Bajaj recently told newspersons.

``CII is all for bringing out the names of the loan defaulters into the open by carrying out suitable changes in the Banking Regulation Act of 1934 which precludes banks and FIs from disclosing the names of defaulters,'' Bajaj said.

The face-off between CII and bank trade unions last week intensified with Members of Parliament (MPs) demanding that the Government publish the name of corporate defaulters which owed nationalised banks a whopping Rs 45,000 crore, and adding that the CII task force had recommended the closure of three banks precisely because they thought this would ensure that no names came out.

The matter was raised by Selva Ganapathy during zero hour and he was supported by members from other parties including former Prime Minister Chandrashekhar and Rajesh Pilot.