From a Corporate Governance perspective regarding the alleged scam at ICICI Bank, involving it's former MD and CEO, her husband, and the Videocon Group promoter, some questions beg an answer:
a) If indeed there were some well-defined procedures laid out at ICICI Bank, for disbursal of loans beyond a certain threshold value, like in this case to few Videocon group entities, then were the same followed by the members of the credit committee which sanctioned the loans? Irrespective of the fact that Ms. Kochchar was a part of that committee, and did not disclose her husband's business relations with Videocon Group,
b) If Yes, then how come was there any violation of established procedures, and if No, then how come none of the other members of that credit committee are in the dock?,
c) Was this particular loan sanction subjected to inspection by the Internal Auditors of ICICI Bank, and did they make any adverse observations? If Yes, then was this report further elevated to the Board via its Audit Committee, and if Yes what was their observations, and what action did the board deem appropriate? If No, then again it can be deemed that such sanction of loans was well within the established procedures,
d) As and when it was evident that these loans to Videocon Group were about to turn into NPAs, did the credit committee follow the established procedures as laid out for any other such assets turning into NPAs? if yes, then it should have been documented, and submitted to the Board via its Audit Committee,
e) It has been reported that the RBI also conducted a probe, and didn't find anything wrong with the process of loan disbursements. If this is indeed true, then was this not a credible proof of the entire procedure of loan disbursements being above board?
f) And finally, Videocon's investments of Rs. 64 crores in Deepak Kochchar's 'NuPower Renewables'. How was this investment decision arrived at, and did it pass the scrutiny of the Board of Videocon Group, or was it just one individual's decision? Secondly, was this amount invested from the loan amounts from ICICI Bank received by Videocon Group, or was it from other source which had nothing to do with the receipt of such loan amounts? And, above all, which other banks/financial institutions had exposures to the Videocon Group at the time when ICICI Bank decided to sanction such loan amounts? Did any of them even raise a red flag before regarding the finances of the Videocon Group?
While it is assumed that our investigative agencies have done a very meticulous job while investigating such an alleged scam, yet answers to above would greatly serve the interests of 'Corporate Governance' in any financial or other institution, dealing with pubic money.
a) If indeed there were some well-defined procedures laid out at ICICI Bank, for disbursal of loans beyond a certain threshold value, like in this case to few Videocon group entities, then were the same followed by the members of the credit committee which sanctioned the loans? Irrespective of the fact that Ms. Kochchar was a part of that committee, and did not disclose her husband's business relations with Videocon Group,
b) If Yes, then how come was there any violation of established procedures, and if No, then how come none of the other members of that credit committee are in the dock?,
c) Was this particular loan sanction subjected to inspection by the Internal Auditors of ICICI Bank, and did they make any adverse observations? If Yes, then was this report further elevated to the Board via its Audit Committee, and if Yes what was their observations, and what action did the board deem appropriate? If No, then again it can be deemed that such sanction of loans was well within the established procedures,
d) As and when it was evident that these loans to Videocon Group were about to turn into NPAs, did the credit committee follow the established procedures as laid out for any other such assets turning into NPAs? if yes, then it should have been documented, and submitted to the Board via its Audit Committee,
e) It has been reported that the RBI also conducted a probe, and didn't find anything wrong with the process of loan disbursements. If this is indeed true, then was this not a credible proof of the entire procedure of loan disbursements being above board?
f) And finally, Videocon's investments of Rs. 64 crores in Deepak Kochchar's 'NuPower Renewables'. How was this investment decision arrived at, and did it pass the scrutiny of the Board of Videocon Group, or was it just one individual's decision? Secondly, was this amount invested from the loan amounts from ICICI Bank received by Videocon Group, or was it from other source which had nothing to do with the receipt of such loan amounts? And, above all, which other banks/financial institutions had exposures to the Videocon Group at the time when ICICI Bank decided to sanction such loan amounts? Did any of them even raise a red flag before regarding the finances of the Videocon Group?
While it is assumed that our investigative agencies have done a very meticulous job while investigating such an alleged scam, yet answers to above would greatly serve the interests of 'Corporate Governance' in any financial or other institution, dealing with pubic money.
