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BANK UPDATE

CBI, ED search BoB branch for Rs. 6K cr 'illegal transfer' New banks to create
25,000 village jobs
The Central Bureau of Investigation ports,” a CBI statement said.
(CBI) and Enforcement Directorate New banks will create 25,000 job in
(ED) conducted searches at various lo- The suspicious transactions were small towns and villages, half of
cations associated with Bank of Baroda routed to Hong Kong allegedly be- them in the next 18 months.
(BoB) and its officials in connection tween August 1, 2014 and August 12, Varanashi-based Utkarsh Micro Fi-
with alleged illegal transfer of over Rs 2015. It has been alleged that there nance plans to recruit 2,000 people
6,000 crore through the banking chan- were 8,667 forex transactions from the in the next 18 months and another
nels to Hong Kong. Ashok Vihar branch of the bank, 2,000 over the ensuing three years.
prompting a probe.
CBI sources said searches were con- "Our operations are in Bihar, Uttar
ducted by joint team of CBI and ED at ED sources said that the agency has Pradesh, Jharkhand and Madhya
three premises including the Bank of already registered a case against cer- Pradesh. We have staff strength of
Baroda, Ashok Vihar Branch in Delhi tain bank officials and private persons 2,200 and our intention is to give
apart from residences of BoB AGM SK under the stringent sections of the jobs to people who want to come
Garg and Jainish Dubey, who is a for- Prevention of Money Laundering Act back to their home town," said
eign exchange officer with the bank. (PMLA). An official said the matter is Govind Singh, promoter and MD,
CBI sources said the two officials have being investigated by CBI and inter- Utkarsh Micro Finance.
been found to be involved in the ille- nally by the bank. It was brought to no-
gitimate transfer of the amount to tice by the bank itself and there will be Bandhan Bank has recruited 8,500
Hong Kong. no financial implications for the bank, people in the past year, taking its
he claimed. workforce to 19,500. Nearly 80 per
The case was registered on a com- cent of Bandhan's staff is posted to
plaint from the bank which had found BoB is now functioning without an MD small towns and villages.
these “unusual” remittances during an and CEO. Ranjan Dhawan, MD & CEO-
audit of its accounts. CBI has registered incharge, retired on September 30. IDFC plans to begin operations with
its case under various sections of In- Though the government appointed fewer branches than Bandhan's
dian Penal Code and the Prevention of VBHC Value Homes managing director 500, yet over the past year it has
Corruption Act against 59 current ac- and CEO PS Jayakumar as the new BoB recruited 2,000 people for its rural
count holders and unknown bank offi- managing director in August, he is yet operations.
cials and private persons. to take charge. BB Joshi is the only ex-
ecutive director of the bank. Former Apart from the two universal banks,
“It was alleged that 59 current ac- Microsoft India head Ravi Venkatesan the Reserve Bank of India has issued
count holders and unknown bank offi- is the non-executive chairman of the licences for 10 small banks and 11
cials conspired to send overseas remit- bank. payments banks. All of these are ex-
tances, mostly to Hong Kong, of foreign pected to be operational in the next
exchange worth approximately Rs Earlier, BoB detected a Rs 350 crore 18 months.
6,000 crore in illegal & irregular man- bill discounting irregularity and initi-
ner in violation of established banking ated an investigation into the matter.
norms under the garb of payments The bank discounted bills worth Rs 350
towards suspected non-existent im- crore but the payment never came.

SBI not to sell insurance plans of other firms

Inspite of the guidelines issued by the IRDAI which allows the banks to tie-up with three insurers from each segment of
life, non-life and health to sell their products, State Bank of India has said it will only market schemes of its subsidiaries.
"We entered into some contractual obligations with our foreign partners at the time of signing the joint venture agree-
ment with them. As it is not mandatory (to sell products of other insurance firms) we are not looking at it right now," SBI
chairperson Arundhati Bhattacharya said. Currently SBI is selling schemes of its subsidiaries (SBI Life and SBI General)
and this arrangement will continue, she said. However, she said the bank is not against brokers being allowed to appoint
sub-brokers to sell insurance plan as it will help to increase insurance penetration.

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