SRINAGAR: A media report about the financial indiscipline in the state's premier financial institution J&K Bank has evoked sharp criticism from the opposition Peoples Democratic Party, which has threatened to push for RBI audit if the government failed to clarify on the bad debts to the tune of Rs 2500 Crore, lent to non-state individuals and institutions.
Expressing deep concern at the murky details of nonperforming assets (NPA) revealed in a local daily on Friday, Peoples Democratic Party's spokesman Nayeem Akhtar sought immediate explanation from the Finance Minister Abdul Rahim Rather. "The bank management seems involved in these malpractices that could threaten the very health of the Bank as is apparent from the crash of its share prices today," Akhtar said in a statement. He said the finance secretary of the state who is on the Bank's board of directors should also clarify his position on the goings-on in the bank.
"If the authorities don't come clean on the issue the PDP would be forced to write to the Reserve Bank of India for instituting a special audit so that the people come to know the truth," said Akhtar.
The PDP spokesman said it was extremely worrying that state's most important and premier financial institution had been compromised by appointing wrong persons on the board of directors and the bank management. It appears even the auditors come under cloud as reported by the newspaper.
Akhtar said the press release of the Bank issued in response to the story does not deny the figures quoted in it. Far from giving any comfort the bank response raises more questions than it has tried to answer.
Akhtar said the shady deals in the bank are provided a cover by appointing blue-eyed persons with dubious record who apparently are beneficiaries of the malpractices. He said it was ironical that a government that served a severe blow to state's financial autonomy by shifting to RBI for overdrafts had claimed that the move would improve transparency in the bank.
Akhtar said while within the state the bank loans are very stingily sanctioned, big loans outside the state are obviously given to those who don't even deserve them. He said while millions of youth in the state are struggling to set up small businesses and denied loans but the bank with resource base in the state has apparently been made a handmaiden of vested interests outside the state in order to benefit a few in position of power at the cost of a national asset of the state.
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