JK Bank chairman removed due to splurging on ‘elites’, nepotism: Govt

JK Bank chairman removed due to splurging on ‘elites’, nepotism: Govt

Srinagar: The government on Wednesday spelled out the reasons for unceremoniously showing the door to former Jammu and Kashmir Bank chairman Parvez Ahmad. His removal from the top post, according to J&K Chief Secretary BVR Subrahmanyam, was mandated after the Reserve Bank of India pointed out governance issues in the state-owned bank.
Commenting for the first time on the chairman’s sacking last week, Subrahmanyam revealed that the RBI had written to the J&K government about profligate spending under the bank’s corporate social responsibility (CSR), including Rs 50 crore spent on a golf course, and appointments made in the name of CSR.
Subrahmanyam said the government was now setting up an eminent panel to appoint a new chairman and a separate managing director for the bank.
“We all know under whose recommendation people were being appointed. It was called CSR. A bank is fundamentally not an employment agency. How can people be employed under CSR in the bank?” he questioned.
J&K Bank had moved away from its fundamental objective of banking, he added. “That is what RBI meant when it pointed out about governance issues in the bank,” he said.
Dubbing as profligacy the bank’s spending of money under Corporate Social Responsibility (CSR) for “elites”, he divulged that even while Rs 500 crore were given by the J&K government to the bank as capital subsidy, it was spending Rs 50 crore on the Royal Springs Golf Course.
“A bank which requires government money to be operational, has it any business to spend Rs 50 crore under CSR on RSGC renewals, where less than a thousand people play?” the chief secretary said. “That (golf) is an elite sport. Go and ask people how many of them play in the golf course. It is unacceptable for a bank that is living on government money.”
According to Subrahmanyam, the bank will be made a shining example and the results will be there for all to see in three months. “The bank will be protected. It will be a shining example and would get branches all over London, Singapore,” he said.
Meanwhile, the bank will be implementing RTI and CVC guidelines by June end, Subrahmanyam added.