Asks PMO to frame law for it
The Central Vigilance Commission (CVC) has urged the Prime Minister’s Office to bring private sector banks under its watch, citing the fact that they have been involved in many recent instances of malfeasance.
Vigilance officers in all State-owned public sector banks are required to report irregularities and possible wrongdoing to the CVC, India’s apex body for checking corruption in the government. Private sector banks are out of the CVC’s purview, but are subjected to statutory audits from the Reserve Bank of India (RBI).
Deviating from norms
Private banks have been rapped in recent months by the banking regulator for deviating from norms that govern the disclosure of non-performing assets (NPAs), leading to under-reporting. The processes followed for lending decisions among private lenders have also come under the scanner.
The Central Bureau of Investigation disclosed last week that it has initiated a preliminary inquiry into loans granted by the country’s largest private lender ICICI Bank to Videocon Industries as it suspects a nexus between Deepak Kochhar, husband of the bank’s CEO and managing director Chanda Kochhar, and Videocon chairman Venugopal Dhoot.
“The CVC has requested the PMO to consider empowering it to have an oversight on private banks as well, and make the legislative changes to facilitate the same,” said an official.
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