Top Indian Bankers Under Scanner in Loan Scam

K.V. Kamath, president of the New Development Bank, a BRICS initiative, is likely to face a probe in India’s multi-million dollar loan scam in which the ICICI Bank, of which he was the CMD until 2009, allegedly disbursed loans to private entities in contravention of rules and policies.

New Delhi (Sputnik): India's Central Bureau of Investigation (CBI) has filed a First Instance Report (FIR) against Chanda Kochhar, former chief the ICICI Bank, the country's largest private sector lender in cases pertaining to alleged fraud in the disbursement of loans to private entities. Furthermore, the federal investigative agency has also announced that it would soon launch a probe against other big names in the banking sector, including K.V. Kamath, chief of the New Development Bank, and Sonjoy Chatterjee, India head of Goldman Sachs.

Kamath is credited for having catapulted the ICICI Bank Ltd to the status of India's second-largest lender. He headed the bank for 13 years until 2009 and took charge of the New Development Bank in 2015.

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K.V. Kamath was appointed to the prestigious position of chairman of the New Development Bank (NDB), created by the five-member BRICS group in 2015. The BRICS countries — Brazil, Russia, India, China, and South Africa — finalized setting up the NDB at the group's summit in Fortaleza, Brazil, on 15 July 2014.

Initially, the CBI had unearthed suspicious transactions of six high-value loans of around $470 million that were disbursed by the sanctioning committee to the Videocon group between June 2009 to October 2011 in contravention of the rules and policies of the bank.

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A subsequent probe indicated that loans amounting $223 million were sanctioned on various dates by various committees having senior officials of the ICICI Bank as members, namely K.V. Kamath, Sandeep Bakshi, the current CEO of the ICICI Bank, N.S. Kannan, current CEO of ICICI Prudential Life Insurance, Rajiv Sabharwal, current CEO of Tata Capital, Zarin Daruwala, current CEO of the Standard Chartered Bank in India, Sonjoy Bhattacharya, chairman of Goldman Sachs (India) Securities. The alleged irregularities happened at a time when these personalities were in the screening panel of the ICICI Bank.  

"These loans have turned NPA (non-performing assets) resulting in a wrongful loss to ICICI Bank and wrongful gains to the borrowers and accused people… The role of these senior officers of the sanctioning committee (abovementioned) may also be investigated", the CBI statement issued on Thursday reads.