Irregularities in BoR advances

the loans. The team has noted that BoR’s finances have weakened considerably as a result of these irregularities. The bulk of the advances have allegedly gone to Bangur Finance, sources said.

When asked to comment on the alleged irregularities, managing director I Sadasiva Gupta said he had yet to see the report of the audit team. He, however, added that bank has now decided to concentrate on reducing its non-performing assets (NPAs) which total around Rs 190 crore.

Gupta, who joined the bank only a few months ago, said he had initiated some steps to improve its working and the results of the current year would be much better. The bank’s fundamentals continued to be strong despite the fact that NPAs had risen to 13 per cent of advances (net).

Meanwhile, Bank of Rajasthan Financial Services Ltd, which was formed last year with an initial equity contribution of Rs 5 crore, has reportedly become non-functional due to bad advances. These advances are placed at around Rs 20 crore.

Keshav Bangur, former deputy chairman of BoR, and his father, A N Bangur, have been barred from the bank’s board by the RBI for a period of five years.

Bank of Rajasthan made a net profit of Rs 2.13 crore in the first half of the current financial year as against Rs 40.01 crore in the corresponding period last year.

Gupta said after making the provisions of Rs 22.02 crore in the first half of this year, the bank would be able to contain the NPAs at the end of this year to the level of last year. "We are monitoring each and every account closely now with a view to making recoveries," he said. Gupta was formerly head of Vysya Bank.

Gupta said he had already issued notices to the companies and others who had borrowed from the bank and had defaulted in making the repayments. Some of the notices had even returned.