August 11, 2020

AIBEA seeks review of appointment of K.V. Kamath as head of resolution panel

[ by Legal Era News Network ]


The Reserve Bank of India (RBI) had last week, set up a five-member committee under ICICI Bank’s former CEO and non Executive Chairman K.V. Kamath’s leadership to make recommendations on the required financial parameters to be factored in the resolution plans, which will be drawn up by lenders as part of a special window under the “Prudential Framework on Resolution of Stressed Assets”.

The All India Bank Employees Association (AIBEA) has expressed its opposition to the appointment of K.V. Kamath as the Head of the Expert Committee on Resolution Framework for Covid19-related Stress as his name figures in a CBI First Information Report (FIR).

The AIBEA in a letter to Shaktikanta Das, Governor, RBI on August 9 said that as per media reports Kamath’s name figures in the FIR lodged by Central Bureau of Investigation (CBI) in the infamous scandal in ICICI Bank involving its former chief Chanda Kochar for sanctioning loan of over Rs. 3,000 crore to Videocon group.

“It is reported that besides being the former CEO and non-Executive Chairman of ICICI Bank, he was also a member of the Committee that approved the loan to Videocon Group which have now become questionable and are under investigation.

“Hence we strongly feel that at this stage, making such a person as Chairman of this Expert Committee is avoidable and needs to be reviewed,” C.H.Venkatachalam, General Secretary, AIBEA told RBI Governor.

Venkatachalam also recalled the recommendation of Kamath led Task Force set up by Confederation of Indian Industry (CII) in 1999 on bank non-performing assets (NPA) to close Indian Bank and privatisation of State Bank of India and Bank of Baroda.

“AIBEA questioned the Committee and its recommendations, as one of the member of that Committee himself was a bank loan defaulter,” Venkatachalam said.

“Today Indian Bank is one of the best run Banks and everyone also knows the growth and progress of SBI and Bank of Baroda under public sector,” he added.

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