Corporation Bank Chairman and Managing Director Ramnath Pradeep today refuted charges of inappropriately sanctioning big-ticket loans, saying if the allegations were true, the bank's net non-performing assets (NPAs) would not have been below one per cent of the total advances.
When asked about the charge of misappropriated funds, Pradeep asked, "How is it possible, with the net NPAs of the bank at just 0.47 per cent?"
The finance ministry had called for explanation from the chairman and managing director on the basis of a report by the Chief Vigilance Commission (CVC) on irregularities in disbursing loans. The CVC, after complaints of irregularities in the disbursement of loans from the bank, had sent a special team in May to the bank's headquarters to investigate the irregularities.
"The ministry has just asked for a clarification, we have prepared our response and we would give it soon," he said on the sidelines of an event organised by the PHD Chamber of Commerce. Pradeep said the Mangalore-based bank was aiming to eliminate NPAs by the end of this financial year.
He said though there were fears of an economic slowdown, these would not hit India in a big way. "Banks in India are sufficiently strong to withstand shocks because of the best practices adopted by our regulator," he said. He added though banks were affected by the Reserve Banks of India's rate rise spree, one should also look at the fact that inflation was a major concern.