IBA asks Bank employees to refuse verbal orders ( News items given below)
16.December 2013
16.December 2013
Indian Bank
Association has got no legal status and no moral authority and no
administrative power to issue orders or advices to field functionaries or to
member banks. However IBA has thought it necessary to advice bank employees not
act on verbal orders of superiors. It is nothing but an attempt made by IBA
which is made of Chief of various banks only, to save chief of banks who are
being accused of applying corrupt practices in sanction of loans to serve their
self interest and who are responsible for unprecedented rise in Non Performing
assets or bad debts in banks.
It is a classic
example of a leader of a gang of thieves thief dictating member thief not to
steal and not allow stealing to co-workers or colleagues. Advices given by IBA
to bank staff is just like politicians delivering sermons and making large
promises to common men while delivering “Political Bhasan” in his constituency
or elsewhere. Politicians never say that they will promote corruption, they
always say that they and their party will give clean government and whoever
indulges in corruption will be taken to task.
But the level of
corruption in all offices and in all ministries has increased to unbearable
extent all over the country. India’s ranking in the world on the
matter of corruption is increasing year after year. It is however also true
that whenever any minister or any Neta is accused of indulged in scam or
promoting corruption, he blames administrative officers for the crime and on
the contrary when officers are accused of corruption in their work or use of
corrupt practices they cleverly put entire blame on Neta
under whose pressure or verbal orders they acted. This is the normal culture
and normal ritual in all sphere of life.
There is a warning in
all packets of cigarette “Smoking is injurious to health”. There is warning on
each bottle of wine, “Drinking is not safe and injurious to health” . But
neither drinking nor smoking has been stopped or reduced .There are many types
of board containing valuable advices and warning for customers and
staff available in all offices and properly displayed in all banks too. But the
question is whether they are able to stop the corruption or they are hanged on
wall as ritual and as date calendar. Government in India runs on boards and
banners, hoardings and advertisements, slogans and sermons and in the same way
all offices functions and get award of excellence by certificates of good work
given by purchased juniors and inspectors.
Boards are hanged on
wall in all branches and in all government offices that “corruption is a bad
practice”. Boards displayed on wall speak clearly “we solemnly take oath to
work devotedly, sincerely and honestly in the interest of the bank and
customers of the bank without taking any bribe or gift in lieu of any work done
by us. ”. Boards containing addresses of Regional Head of the bank or Zonal
Head of the bank, or that of Chief Vigilance officers and Ombudsman are
displayed prominently in all offices, but these boards are proved to be
ineffective. There is a board on every office, “May I help you”. But customers
of the bank cry for smooth and quick work, there is no one to listen to this
demand and his request.
In judiciary ,
whenever any witness or any accused appear before any magistrate or any judge ,
he or she to take oath keeping hands on pious religious books that he or she
will speak true and true only . But the fact is that the act of crime has been
increasing in judiciary or in all administrative offices in India unabated. And
the most painful is that real criminals are always or mostly exonerated and a
few innocent witnesses or who watch the act of crime willingly or unwillingly
or who dare say the story of crime are taken to task and punished.
As such the advice
given by IBA is nothing but BUKWAS and nonsensical .I may rather say without
any hesitation it is the mostly the top officials who create corrupt culture in
an office. If a boss is hard, honest and sincere worker, there is no doubt that
all evil doers will stop their ill-motivated work or take transfers to other
places. There are many instances of hard IAS and IPS officers whose
effectiveness and image of toughness reaches new place of posting before he or
she actually joins duty there. Criminals move to other district as soon as an
effective and honest officer is posted in a particular district. People all
over the country perhaps know the image of Kiren Bedi. Similarly there are good
officers in banks too, but their effectiveness is dismal, their value is
negligible and their elevation to upper post is a rare phenomenon. This is why
most of corrupt officers reach top position in short tenure of service and they
form a gang to serve the mutual interest of each other.
No rule or no circular
in any bank ask any bank staff to indulge in corrupt practice or to act upon
verbal bad orders . Still corruption and bad practices are there in banks in
case of not only in sanction of loans but also in recruitment, transfers,
promotions, allotment of work to contractors, renovation of branches, on
advertisement bills, in purchases of hardware or software etc.
Eyes and body language
of the seniors are enough to say what a junior has to do and what not to do if
he or she has to survive , if he or she to remain in bank peacefully .
Otherwise a chain of transfers, rejection in promotion processes and issue of
false charge sheet is common. ON the other hand if an officer is Pucca Yesman ,
who always speaks ‘Yes Sir’, who earns bribe and share honestly with the bosses
and who is number one flatterer is exonerated even if he or she is found to be
responsible for hundreds of irregularities and thousands of act of corruption.
Until this culture of
flattery and bribery is changed at ground level, it is foolish to believe that
any such circular as issued by IBA or Government of India advising to refrain
from verbal orders of seniors will be effective.
NEW DELHI: In an attempt to stem the tide of rising bad loans at Indian lenders, a lobby group of banks has directed its members to ensure that their staff neither give nor act on verbal orders for sanctioning loans.
The Indian Bank's Association (IBA) issued the directive recently after the Central Vigilance Commission pointed out that junior executives at some banks were "coerced" to sanction loans on verbal orders from their superiors.
What RBI’s NPA move really mean: Govt control on
banks should go by Rajesh Pandathil Dec 16, 2013-
Published in First Post 17.12.2013
If
you were wondering why public sector banks have higher NPAs than their private
sector counterparts, a report in The Economic Times today may give you an
answer. According to the report, often the loan sanctioning process in a
state-owned bank involves just one step—phone call from a senior official to a
junior staff, says the report.
The Indian Bank.’ Association has
urged banks to take steps to stop such practices, the report says. “During some
vigilance complaints it was reported that loans were initially sanctioned on
verbal orders. This had led to discrepancy as junior officers had claimed that
they had sanctioned loans after receiving orders to expedite the case from
senior authorities,” a senior government official has been quoted as saying in
the report.
No wonder, there has been an
alarming rise in bank NPAs. According to the finance ministry data, gross NPAs
of public sector banks had declined to 2.09 percent in 2008-09 from 14 percent
in 2000. Ever since, the figure has again been rising. As of June, the gross
NPA of nationalised banks was nearly 4 percent—Rs 1.92 lakh crore. This is a
steady increase from Rs 1.64 lakh crore in March.
More alarming is the increase in
bad loans restructuring, an exercise that dress them up like a performing
asset. According to the RBI data, in 2012-13 the number of loans restructured
under corporate debt restructuring mechanism rose 37 percent. The amount
restructured thus surged 52 percent. The authorities are slowly but surely
waking up to the reality.
A report in the Business Standard says the
Reserve Bank of India is planning to put in place new norms to help banks spot
non-performing assets early on and deal with them. The report says the RBI will
force banks to profile a borrower at the very first instance of a default.
Further, a panel of lenders’
consortium will vet decisions taken on loans of Rs 100 crore or more. This move
is expected to curb restructuring. Another step being considered is giving
incentives to banks which identify potential NPAs early on. The norms being
mulled are pre-emptive in nature. They are aimed at encouraging banks to spot
an NPA early on and taking necessary measures. But that is not all.
They also have pointers to the
government. As is evident from the instances mentioned in the ET report, the
increase in non-performing assets in public sector banks is also a fallout of
the bad governance, stemming from the government’s excessive control over them.
The senior official who coerces the
junior staff to sanction a loan might as well be acting on the behest of a
political boss. It is crony capitalism at its best. The government’s control
over banks has adverse impact not only on their governance. They take a toll on
their business too.
How many times have the finance
minister pushed banks to cut interest rates even though the interest rates in
the economy are on an upmove?
Moreover, as Firstpost’s R Jagannathan argues
in this article, the government’s firm grip on its banks is killing innovation
in the banking sector. “…Government ownership is the biggest barrier to
innovation. It is impacting the pace of innovation even in private sector banks
because competition is weak from public sector banks.” If the authorities are
serious about bringing down the NPAs, they should first bring down the
government’s control over banks.
It would be good if the government
remembers what Raghuram Rajan said about wilful defaulters. “Promoters do not
have a divine right to stay in charge regardless of how badly they mismanage an
enterprise, nor do they have the right to use the banking system to
recapitalise their failed ventures.”
Read more at:
http://www.firstpost.com/business/what-rbis-npa-move-really-mean-govt-control-on-banks-should-go-1289063.html?utm_source=ref_article
I request humbly that why all the writings are blocked by advt. It is ridiculous we are unable to read the article as there is no way to get rid of these blocks of advts. Please do something lest people stop reading and referring your site.
ReplyDelete