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Shareholders, Unions Back Bank of Maharashtra Brass in Dock for Bad Loans

At the annual general meeting on Thursday, the shareholders reposed their faith and confidence in the bank and its leadership team.

PTI

Updated:June 21, 2018, 6:30 PM IST
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Shareholders, Unions Back Bank of Maharashtra Brass in Dock for Bad Loans
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Mumbai: The shareholders of the embattled Bank of Maharashtra and bank unions today came out in support of its arrested brass for their alleged collusion in extending loans to the scam-tainted realty player DSK Group.

At the annual general meeting on Thursday, the shareholders reposed their faith and confidence in the bank and its leadership team.

The shareholders acknowledged the team's impeccable service record and various efforts undertaken for steering the bank towards profit.

The economic offences wing of the Pune police had yesterday arrested chairman and managing director Ravindra Marathe, executive director Rajendra Gupta, zonal manager Nityanand Deshpande, former chairman Sushil Muhnot in a cheating case lodged against real estate developer DS Kulkarni and his wife.

The arrest was made despite the bank disclosing that it had only a little over Rs 92 crore exposure to the DSK group and that the entire loan is fully secured and the loans were given before Marathe took over.

The All-India Bank Employees Association in a letter to the financial services secretary Rajiv Kumar said it is surprising that the executives of the bank, who as per information, are not connected with the cheating by DSK Group.

"Hence, arresting them at this stage in connection with this is unwarranted. If there is any involvement of these officials in the DSK scam, they should be taken to task but as per our information, they are not involved in the same," association general secretary CH Venkatachalam said in the letter.

The Pune police has overstepped in this regard and government should intervene, he added.

The letter said the arrest has dented reputation of the bank besides harassment of these officials.

"Defaming public sector banks and harassing their executives who are not involved in a scam will only demoralise the workforce," the letter said.

In a statement issued yesterday, Bank of Maharashtra had said its total outstanding exposure to DS Kulkarni Developers was close to Rs 94.52 crore and is fully secured by primary and collateral securities.

Loans sanctioned to firm were as per the bank's lending norms.

The bank has already declared the group and its promoters as willful defaulters, it said in the statement.

The recovery process has already been initiated and some of the properties of the defaulting group are due for auction, the bank had said.

While seeking the bank officials' custody, the police told the court that the accused bank officials -- Gupta, Munhot and Deshpande -- did not follow the set guidelines of the Reserve Bank while sanctioning the loan to DSK.

"The bank officials, under the consortium, had sanctioned a loan of Rs 100 crore to Kulkarni's Dream City Project when other banks were yet to give their nod for funding to the project," the remand plea said.

Further, after sanctioning the loan, the accused made the changes in the original proposal and disbursed Rs 50 crore to Kulkarni, it said.

The police also told the court that the loan was to be used for a particular project, but the bank officials did not ascertain if DSK was using the money for the stated purpose.

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