Booked for cheating in Niravgate, bank honcho Usha set to lose job

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PNB executive directors Brahmaji Rao and Sanji Saran, and general manager Nehal Ahad will also be charged.

As per the ownership in the bank is concerned, the Government holds a little over 62% stake in PNB and close to 65% in Allahabad Bank. Allahabad Bank's board is likely to take a call to divest the powers vested with the current CEO. "In the meantime, the bank has convened a meeting of its Board of Directors on May 15 to discuss the matter", the lender said in a regulatory filing.

A Ministry official told IANS that the Department of Financial Services (DFS) had asked the government representative in the Allahabad Bank to come up with a proposal before the board to strip Ananthasubramanian of her powers.

The agency has not given in detail the role of Mehul Choksi in the present chargesheet. The government is a majority stakeholder in these banks.

"For removal and disciplinary action, there's a set procedure, under Section 8 of the Nationalised Bank Schemes 1970".

The Financial Services Secretary further said a show cause notice was issued to them about 10-days back by the ministry.

The PNB board has chose to remove the EDs named in the CBI chargesheet in an emergency meeting on the insistence from the government's nominee director. The latest round of measures were taken with respect to the bank's capital-to-risk weighted assets ratio and leverage ratio position, Allahabad Bank said.

Ananthasubramanian was PNB managing director for about 21 months from August 2015 till May 2017 as also executive director at PNB between July 2011 and November 2013.

"While we have recovered documents including original applications for seeking loan through LoUs of over 130 of the 144 LoUs mentioned in the first FIR, the charge sheet concentrates only on half-a-dozen LoUs and an equal number of FLCs as we have been able to collect evidence to prove that they were fraudulent", said an official". She was questioned recently by the CBI in connection with the case.

The problem is generally in the large corporate side, while branches across the country by and large are corruption free, he said.

Expressing faith in the banking system, Kumar said banks have a strong, robust tradition and they follow highest standard of corporate governance barring few stray cases. According to a report on Mint, the move is a part of the government's attempt to clean up the banking system.

"At most a case could be made out for the MD and directors not observing sufficient due diligence in detecting the fraud", the director of a Delhi-based state-run bank said.

This is unedited, unformatted feed from the Press Trust of India wire.