| Govt clears loan to bank as grant |
Full Story can be found at http://www.dnaindia.com/
In a controversial decision, the state government last week converted, with retrospective effect, a Rs110 crore-loan to the troubled Nanded District Central Cooperative Bank (NDCCB) into grant.
The bank, in the hometown of chief minister Ashok Chavan, is monitored by a RBI-appointed liquidator after it ran into financial problems over a decade ago due to bad debts worth over Rs750 crore.
NCP and Congress stalwarts, including some of Chavan's close confidants and union minister of state Suryakanta Patil, formed the NDCCB's board of governors when it ran into trouble and RBI pitched in.
The bank's records show some of the board members are among the big defaulters but they were not questioned.
The RBI stalled its transactions when the bank's net worth fell sharply.
The government defending its decision said the bank's net worth needed to be made positive to resume business.
But a farmer's body has opposed the bail out package to the bank.
Thousands of small farmers, depositors, primary agriculture societies and the bank employees in branches all over the district suffered as a result of someone else' sins, said Kishor Tiwari of the Vidarbha Jan Andolan Samiti, a farmers' body.
"Now the government steps in to bail the bank out by paying from taxpayers' money to cover up the sins of political stalwarts." This needed public scrutiny, he said.= = = = = = = = = = = = = = = = = = = = = = = = = = = = = = = = = = = = = = = = = = = = = = = = = = = =
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