by

Rajesh Goyal 

After a week long tussle, finally the head of Pawan Kumar Bansal has rolled.   I usually do not write on this website the articles which are political in nature.   However, I decided to write on this political hot topic as it involves Canara Bank too and anybody who has worked in Senior Management and Top Management of any nationalised bank, must have heard out (may be in hushed tones) about the sale of top jobs in banking industry too.   Am I wrong?   I think most of my fellow bankers will agree with these views.  They may differ about the amount that is required to get the plum posts in nationalised banks, but the amount negotiated by the kins of Railways Minister for sale of railways' plum posts, may look too meagre when compared to the amount said to be paid for top jobs in nationalised banks.  It is undeniable basic fact that if you have paid huge amount to get the top post, you must have to adopt corrupt practices to recover such an amount and then save something extra for yourself for taking all that risk! 

Mr Bansal has also worked as State Minister of Finance for short duration.   During that period, in case of promotion processes, bankers used to be talk about  as to why some of deserving candidates had to be left out so as to accommodate the candidates who had recommendations of the Minister or his close relatives.  This was at  Middle / Senior Management level and not at top level.   It is not necessary that for such promotions money would have changed hands as these are lower functionary jobs.  But it is indirect route for corruption.  Such promoted officers remain loyal to such Ministers and CMDs.  As such officers go up in hierarchy in next few years because of clout, these officers in top management then go out of the way in sanctioning loans to parties who are recommended by such Ministers.  They put up all sort of pressures on lower staff to process and sanction such loans at a lightening speed.  Thus, in few years the top posts in nationalised banks are headed by mostly officers who are stooges of such political and bureaucratic bosses.   That is how the downfall of the organisation starts.   All bankers have silently watched this downfall at large scale in last one decade or so.

The details of the loans sanctioned in the firms where Mr Bansal was interested will soon tumble and may even become NPA.  As per reports, Canara Bank can be first casuality.  I heard that in recent months, Canara Bank had phenomenal growth in Chandigarh region.   If it is true, then it will not be difficult to find out the reasons for the same.   Inspite of so much speculations and exposes in the media, Canara Bank has failed to show that it means transparency.   There is complete silence which fuels the speculation that whatever is released in media is nothing but true.   RBI too has not even committed that it will probe the facts and then release the truth in public domain. 

In view of the large scale perception that there are huge exchange of money for top posts in the banking sector too, there is a need for constant vigilance and  investigation.   The role of CVC has also been limited to punish only some of the junior functionaries in banking sector.   We have hardly come up wherein some top functionaries have been arrested or punished, giving a false impression that top bosses are totally clean and it is only junior functionaries who are corrupt.    Now if CBI parrot (as nick named by SC) decides to come out of the cage and sits on the MoF trees, it will be able to gather huge evidence about the sale of top jobs and why NPA in banking industry are on the increase.

Now I will like to quote from a letter received by us from Mr D.Jain where while summing up he writes  "In brief, posts of ED and CMD are either used for obliging a closely related person or sold at some price.   Very few get success purely on the basis of their merit and performance and they are promoted to show the common bankers that merit is also respected by promotion committee"  [Such good officers, when promoted are usually sidelined and given posts which are of least importance.]

Mr Jain further writes "..if CBI honestly investigates into all appointments made during five to ten years, it will be clear that so many Bansals directly related to Minister's family or not , have got key post not only in banks and insurance companies but also in other public sector undertakings.".

The above clearly indicates the frustration of honest and hard working bankers who are denied promotions and are sidelined and posted at remote places.   This has reached its zenith in last decade and now honest and hard working bankers in the middle level officers across the nationalized banking industry are at loss as to how to cope up with such corrupt and incompetent bosses.   The results are reflected in the shape of increasing NPAs and slow down in growth, and large scale dissatisfaction among the honest officer class.

Personally speaking, I feel the role which bankers can play in eradicating corruption is huge, because in all large scale corruption money has to move through banks.  In this age, even the highest political level class or corporate finds it extremely difficult to keep cash in crores.   Most of the time, such money laundering takes place only with the knowledge of bankers.   This fact is also known to public now after the exposes of Cobrapost.com.   I feel Cobrapost has done a yeomen's service by releasing takes wherein bankers are suggesting as to methods that can be used for money laundering.   I think Cobrapost must have been left with no alternative except to capture these on camera, as even honest and hard working bankers are afraid to talk about such things in media because of false implications by other corrupt officials.   Thus, it is on the increase as corrupt bankers have become more and more emboldened in last few years. 

There is an immediate need that CBI steps into and brings out some water tight cases against some of the top bosses in banking industry and officials of MoF / RBI.   Punishment to at least some of them will create a fear of arrest by CBI etc.   This will help in at least reducing corruption and nepotism at various levels in banking industry.     

RBI too needs to do introspection.   Let them ask all the banks to put upon their website the list of all the directors on their Board alongwith details of the limits availed and outstanding loan amounts from any bank by them or their firms as on 31st March every year.   Moreover, the directors be asked to confirm on affidavit about the close relatives who are either Ministers in Central / State Governments or relative of Joint Secretary and above at Centre.   Bankers are asked to classify the normal accounts too based on Risk profile e.g. political sensitive accounts.   Then why the Directors on the Board of Banks should not be classified according to Risk Profile of that person.    This transparency is necessary to expose the nexus between Members of the Boards of banks and politicians / bureaucrats in the light of Bansal episode.  If RBI fails to do so, let such relations be exposed at social websites like Face Book from where these will be picked up by media persons and hopefully bring greater transparency.

I wish some honest people in RBI and CBI will listen to our feeble voice.