Unions blame CII for creating huge NPAs

MUMBAI, DECEMBER 17: The banking sector and the industry seem to be on a war-path. The All India Bank Employees' Association AIBEA has s...

MUMBAI, DECEMBER 17: The banking sector and the industry seem to be on a war-path. The All India Bank Employees8217; Association AIBEA has said the Confederation of Indian Industry8217;s CII suggestion to close down Uco Bank, United Bank and Indian Bank was a quot;maliciousquot; move by an organisation quot;representing bank loan defaultersquot; who have defaulted loans of over Rs 30,000 crore to these banks.

Unions have urged the government to publish the list of defaulters and take stringent measures for recovery of bad loans including quot;wilful defaultquot; of bank loans. 8220;A number of CII members had taken loans and defaulted. CII would do well to ask its members to repay outstanding bank loans,8221; it said.

quot;If more than Rs 58,000 crore of bad loans are due, the major share is from the private corporate sector. If these loans are repaid, banks will be running on their own steam and be healthy again,quot; said a statement.

Samir Ghosh, general secretary of the All India Reserve Bank Employees8217; Association AIRBEA, said CII8217;ssuggestion is quot;preposterousquot;. He added that AIRBEA had already communicated to the deputy governor of RBI, SP Talwar, to immediately assure bank clients about the safety and security of their bank deposits.

He claimed that a large chunk of the huge unrecovered advances of these banks were due from big business groups, some of which are the quot;promoters and spokesmen of organisations like the CII. He maintained that the suggestion for closure of these banks was intended to cover the quot;misdeedsquot; of persons/groups owing allegiance to organisations like CII.

AIBOC General Secretary S R Sengupta said CII has been behaving in a manner as if it runs the government. 8220;They must understand that they are a club of industrial houses and they have no right to talk on policy issues of government of India,8221; he said.

He said these industrial houses owe Rs 30,000 crore to nationalised banks and were taking all measures how not to pay back the dues which were nothing but people8217;s savings. 8220;If the members of the CII andother industrial clubs would have repaid Rs 30,000 crore back, the health of public sector banks would have been far better than those in other countries,8221; Sengupta said.

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Condemning such a statement, he said the CII suggestions were aimed at weakening these banks by creating a fear psychosis amongst depositors.

UCO Bank chairman and managing director Sharda Singh on Thursday blasted the CII report that has called for the closure of three banks with huge non-performing assets. Singh had said the CII national task force on NPAs in the Indian financial system had five members whose group companies had outstandings to government-owned banks.

quot;It is strange that among the CII group8217;s members, there are five top industrialists who had helped to increase the NPAs of banks,quot; Singh said. The defaults were to several nationalised banks and not just Uco. He refused to name the defaulters among the 15-member group. quot;They carry no credibility and nobody 8212; not even the finance ministry 8212; will give any importanceto this report,quot; Singh said.