United Bank Should Not Be Blamed

It is inhuman, illogical, brutal and absolutely injustice to blame CMD of United Bank (who resigned) for rise in NPA to more than 10 percent. NPA or stress asset accumulation in the books of accounts of UBI is not creation overnight. It has been allowed to accumulate for last so many years willfully and strategically by clever team of officers, Executive Directors and Chairman of the bank to win the praise and appreciation from their mentors and ministers.

There is no doubt that CMD and EDs of UBI who worked for UBI during last ten years did the same fraudulent act in the bank where they worked before they were given the top post in UBI. The culture of bank is carried from one bank to other by none other than ED and CMD of the bank who are appointed by dirty persons of MOF.

I therefore feel that the Bank especially the bank which is considered most high class performer is actually the worst class performer. None can survive in government bank if he or she is not master in art of manipulation and playing foul game with figures and realities. If an officer tells the truth, he or she is thrown like Ashok Khema in Harayana and Durga Nagpal in UP by their bosses..

It is bitter truth that position of NPA is worse in not only in UBI but in all other public sector banks including State Bank of India. Only the difference is that UBI CMD was innocent and simple hearted that she stood boldly against evil doers of the past and forced auditors to declare NPA strictly as per RBI norms. She did not apply motivating and manipulating tactics to persuade auditors to hide NPA as his predecessor CMD and EDs used to do and CMD and EDs of other banks are still indulged in. She did not like to compromise with principles and hence she decided to step down from top post instead of playing in the hands of her regulators and controllers.

If RBI or MOF is honest and bold enough, it should order similar forensic audit at all other banks including SBI. I am very much confident that more disastrous outcome will surface in other banks. NPA ratio is more than 20 percent in most of banks if they are ideally stopped from concealing bad assets on the plea of global recession or false reasons. Restructuring of bad loans or ever greening of loans is rampant culture in banks and very commonly used to hide bad debts.

Cheating and fraud with system is regular phenomenon in public sector undertakings only because ministers and inspecting officials and police officials are bigger thieves.

Munsi Premchand told rightly that if protectors become destructers, none in India can save the system from disaster. And when entire culture is corrupt crisis like what has surfaced in UBI and what is yet to be surfaced in other banks has to happen sooner or the later. When majority of politicians are lacking good culture and honesty, person like Arvind Kejriwal and Ramdeo Baba have to suffer in India.

Last but not the least, if RBI and MOF put pressure on Union Bank to accept amalgamation of United Bank or advise United Bank to merge with Union Bank, the outcome will be more dangerous and fatal. Union Bank will also start journey to hell in short span of time. 

It is therefore desirable that idea of merger is discarded and efforts be made to treat the case of UBI as a classic example to teach lessons to other banks to improve or die. It is the duty of RBI and MOF to punish all officers, auditors and politicians who contributed directly or indirectly in accumulation of bad assets so that message goes to all other banks and from now at least they stop unhealthy practice in the larger interest of the bank, the staff, the customers and the share holders.