Nedungadi Bank: `RBI had ignored warnings'

KOCHI NOV. 7. The All-India Bank Officers Confederation has urged the Reserve Bank and the Central Government to take exemplary punitive action against the former chairmen and directors of Nedungadi Bank for allegedly landing the bank in crisis.

P.V. Mathew, State secretary of the confederation, said the RBI has to be blamed for the bank's crisis. For, the RBI had not taken any action against the bank management in the past when they erred. The RBI which has to periodically monitor the bank's functioning and which has its representative on the bank's board of directors, had failed to check the deterioration of the finances of the Nedungadi Bank. This was criminal negligence on the part of the RBI, Mr. Mathew alleged.

The confederation had for a long time pointed out the misguided operations of the bank management and brought them to the notice of the RBI as well as the Central Government. But they had not cared to listen. The bank management and a section of the employees had ridiculed the confederation's warnings. Mr. Mathew recalled that the confederation members had staged a sit-in in front of the bank demanding a probe into the misdeeds going on in the bank. But these staff had to face physical assaults and several trade union activists were either transferred or harassed otherwise.

Mr. Mathew urged the RBI to lift the curbs on withdrawal of deposits by the public and also hasten the process of the bank's merger with the Punjab National Bank.

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