ICICI Bank faces new whistleblower plaint over loans
24/06/2018
MUMBAI: ICICI Bank has disclosed that it has received a whistleblower complaint, alleging irregularities in respect of 31 loan accounts worth Rs 6,082 crore. The allegations pertain to incorrect accounting of interest income on non-performing assets (NPAs) + as fees and overvaluation of security provided for corporate loans.
The anonymous complaint, received in March 2018, pertains to loans disbursed in earlier years and is distinct from the one which is the subject of inquiry by Justice B N Srikrishna. While Srikrishna’s investigations are into charges that MD & CEO Chanda Kochhar faced conflict of interest + disbursing loans to Videocon, the latest disclosure pertains to income recognition.
The bank said that of the 31 loans, 29 were fully classified as NPAs between FY12 and FY17 and two accounts were classified as NPAs by December 2017. The aggregate loans (adjusted for write-offs) outstanding as of March 2018 were Rs 6,082 crore above 1.1% of the bank’s gross loans.
According to RBI regulations, once a borrower defaults, any repayment by the borrower cannot be treated as income. These repayments have to go into a separate account until the loan is repaid.
A statement issued by the bank to the stock exchanges said that the anonymous communication was treated as a whistleblower complaint and an enquiry was instituted according to the company’s policy. This was done under the supervision of the audit committee of the board of directors, without the involvement of the senior management other than internal audit.
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