Srinagar, Sept 4: Former Chairman J&K Bank, M Y Khan today said the J&K Bank had achieved less growth under the leadership of his successor Dr Haseeb Drabu than what it had attained during his tenure, although he refused to term the performance of the bank under Drabu as dismal.
Debunking bit by bit claims on Bank’s growth, profitability, stock appreciation, credit outflow, etc, Khan said the Bank has not even kept the pace with many of its peers in the sector during the last five years. 

“If the growth of the bank achieved during my time would have been maintained, the bank’s profits at the end of the last fiscal would have been more than Rs.1000 crore,” he said.

Outlining his initiatives that according to him catapulted the ‘cooperative bank image’ of the Bank to that of a corporate entity, he said it was “during my tenure that we introduced modern banking tools like AnyWhere Banking, ATMs, credit/debit cards, etc.”

Khan said it was during his term that the Bank had diversified into insurance business and gone for branch network expansion. “It was not easy for the Bank to join hands with one of the largest insurance companies of the U.S. They trusted us because of our strong fundamentals,” he said.

He said again it was during his tenure that the Bank came to be listed on Indian bourses and “people who invested in the bank’s stocks made good money.”

He said the performance of the bank during his tenure was undisputed. “However, what pained me is the consistent distorted presentation of facts and figures while narrating the success story of the Bank by my successor Dr Haseeb Drabu who resigned recently as chairman and chief executive of the bank,” he said.

When asked why he did not respond earlier “to the distortion of facts and figures”, he said: “I did not want to respond earlier nor I wanted to respond now. But many of the senior executives of the bank who have worked with me and know my performance strongly urged me to respond and that is why I am here.”

He said for the first time in the history the Bank he laid emphasis on asset creation.

Comparing his performance point by point with that of his successor, Khan said the business turnover in 1996, when he took over as chairman J&K Bank was Rs 4200 cr. “When I left the bank it had witnessed a 900 per cent increase reaching Rs 37000 crore in 2005,” he said, adding that on the other hand his successor could achieve less than 100 per cent increase in the business turnover in five years taking it to Rs 60,000 crore in 2010.

Similarly he said in 1996 the bank had an advance portfolio of Rs 1364 crore which witnessed 900 per cent increase at Rs 11517 in 2005, while it soared by just 100 per cent in the next five years during his successor’s term at Rs 23057 crore.

He said during his tenure from 1996 to 2005 the deposits zoomed from a mere Rs 2895 crore to a whopping Rs 21645 crore representing a staggering 800 per cent increase, while during the period of his successor from 2005 to 2010 the deposits scaled only 90 per cent to Rs 37237 crore in 2010.

He said the bank floated its stocks in 1999 at Rs 38/share. “In 2005 the share price went to Rs 400,” he said, adding that in the next five years it could only achieve a hundred per cent increase, which is quite “less as compared to many other banks.”

He belied the claims that the credit portfolio of the bank in J&K in 2005 was just Rs 1200 crore. “Bank’s credit off take at the end of my term was over Rs 5000 crores and not Rs 1200 crores,” he said.

Calling it a financial jugglery he said he was shocked to hear the figure of Rs 1200 crore. “When my successor quotes the figure of Rs 1200 crores as the total credit off-take in J&K in 2005, he deliberately omits thousands of crores of investment that the bank had made by way of overdraft to various organs of the state,” he explained adding that however when he mentions Rs 12000 crores of credit off take at the end of his tenure he deliberately forgets to exclude the OD and other investments within the state.

He said: “I could have easily booked a net profit of Rs 350 crore for 2004-05. But I didn’t instead I did a provisioning of Rs.250 crore in order to insulate the securities portfolio from future market risk and to reduce the duration of its investment portfolio. This I simply did for my successor so that he would be able to absorb the future market shock.”

To a question he said he did not know why his successor was asked to resign. However, he hastened to add that this was the prerogative of the government to ask him to do so, being the biggest owner of the bank.
Calling his successor his friend, he said neither he (Khan) nor Dr. Drabu were bankers. “Drabu is an economist not a banker,” he said.

He hailed the government’s new choice for the post of chairman. He said: “The man proposed by the government has worked with me. He is honest and nice guy.”

Lastupdate on : Sat, 4 Sep 2010 21:30:00 Mecca time
Lastupdate on : Sat, 4 Sep 2010 18:30:00 GMT
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