Shri Satyapal Malik, Governor of Jammu and Kashmir a few days back in an interview to Navika Kumar in Frankly Speaking program on Times Now, while lamenting over rampant corruption in Jammu and Kashmir spoke about gross irregularities in Jammu and Kashmir Bank recruitments. To be exact, Shri Malik said,” [A] group of 40 candidates met me and told me thatthey had qualified the exams as well as interview for the recruitment in Jammu and Kashmir Bankbut were pushed aside by the politicians who put their relatives and supporters from their constituencies in their place and dropped them (these candidates)…… I called the Chairman of the Bank. I told him …….I want jobs for these youth who have qualified the exams. Chairman told me these were not just 30 but 582 cases, where qualified youth were not given jobs……This is the tragedy of Kashmir. People who do not pay bribes don’t have any chance to get a job. Corruption is rampant in Kashmir.” The left out 582 candidates according to the Governor were given the job after he intervened and exhorted all concerned to do justice to them and redress their grievance.
The expose’, labeled by a local daily “bombshell” evoked hysteric responses. The Chairman of the Bank rushed to press denying that any irregularity was ever made in Bank recruitments. A few others amongst us, ignoring the malaise that to the knowledge of one and all, has of late afflicted the Bank, are beating their chest for what they allege an assault on the State institutions and attempt to defame Kashmiris. Those expected to be first to voice concern about the alleged malpractices in the Bank recruitment, and overall malfunctioning of the Bank, have got inserted seemingly a paid statement heaping all possible praise on the Bank administration, certifying everything to be in accordance with rules and taking an exception to what they call a campaign to malign the Bank. A few days later yet another statement is published, this time expressing joy over the statement of Shri Malik that Jammu and Kashmir Bank was a “wonderful” institution and everything that was said against the Bank was not “gospel truth”. They forgot that there was no scope for euphoria and there was nothing to celebrate as the “wonderful” and “gospel truth” remarks were prefixed by “everything” meaning that some allegations were “gospel truth” and followed by the veiled observation that a probe was called for and that ” things will come to fore only after an enquiry.” This is not to give offence to anyone but only to emphasise true role of an important stakeholders in such a situation.
Should we fume over the statement labeling it as part of attack on State institutions only because it has come from the Governor and then under the cover of smoke raised allow the wrongdoings to be pushed under the carpet. Should not we welcome it as one more wake up call to lift the veil, see extent of rot, unmask the characters responsible for it, suggest measures that would put the Bank back on track and help it negotiate the turbulence. We have to understand that institution recognized as symbol of nationhood, is not strengthened by stonewalling discussion, withholding information and promoting opaqueness. Let us without getting emotional deliberate on a few questions crying for answer.
The Jammu and Kashmir Bank, it is no secret, is not in good shape. Its Non Performing Assets (NPAs) reportedly crossed Rs. 6000 crore a few months back as against 883 crores in 2015and the NPAs touched near 11% of net loans. The Gross NPAs to Advances soared to 9.96% inFY 2018 from 5.97% in FY 2015 and Net NPAs to Advances to 4.9% in FY 2018 as against2.77% in FY 2015 and 0.22% in FY 2014. The NPAs were marginally reduced not by actual recovery but by selling NPA assets to Asset Reconstruction Companies (ACR) at 59.04% (1606.35/948.45). The other vital statistics taken universally as fiscal health indicators are disturbing, to say the least. The PCR (Provision Coverage Ratio) was 65.83% ending March 2018 as against RBI minimum of 70%. Return on assets is 0.25 % as against 1.7% in 2014.Gross profit for June- September (Q1,Q2 2018) is reportedly 126 crore as against 1183 crore in 2014 FY. Profit per employee has slipped to 0.02 crores in 2018.The Bank, for reasons not difficult to infer, is keen to keep identity of big defaulters close to its chest. It remains to be known as to whether these loans were sufficiently secured or were granted without collaterals on mere asking. In one such case the Bank allegedly advanced hundreds of crores in loan to a business house that to the knowledge of the Bank authorities was facing bankruptcy when loan was sanctioned and money advanced therefore was literally lost on the date it was advanced. Nobody in Bank is ready to identifythe authorities and the background forces, whobrazenly committed serious lapses while sanctioning loans that lead to the ultimate downslide.
Let us come to the alleged irregularities in Bank recruitment. The Chairman’s clarification that everything was transparent and recruitment was pure merit based, does not sound convincing because of attendant circumstances and tacit admission of irregularities made by none else than the Finance Minister early this year by assuring the legislators that the Bank would be asked to maintain transparency in future. He hinted that the Chairman had caved in to pressure though the Minister had exhorted him not to succumb by reminding him that he was ” fortunate to have him as Finance Minister” implying that he should feel safe and secure. The Minister fairly admitted that “there have been some serious lapses in corporate governance and management failures in…Bank.” The discussion on backdoor appointments however was resisted cautioning that it would result in “costs to the Bank” affect the “interests of institutional investors” of the Bank and “hamper its growth”. Let us now come to 582 fresh appointments. The Chairman to explain the 582 appointments insists that Bank only operated the waiting list. This makes things more murky, raises a host of questions and reminds of the adage ” Justifying sin is worse than the sin”. Why was the selection process, initiated on March 19, 2015 unjustifiably delayed for more than 2 years and why did the Bank avoid to publish merit list so that the candidates not having the requisite merit would realise that they had lesser merit and therefore were not to nurse any bitterness. How could select list include 1250 Banking Associates when these posts were not advertised at all. Did not Bank by doing so deprive thousands of eligible aspirants from participating in the selection process for 1250 BA vacancies and now in all 2182 such posts. Is it true that after the initial appointments based on the select list were made, individual appointment letters were issued from Civil Secretariat in favour of 350 candidates not included in the select list? Was any waiting list to be operated against the posts that remained unfilled because of non joining of appointees, ever prepared and made public? and more importantly how can a waiting list be operated against “future vacancies” that Chairman boastfully claims to have done and for doing, what is against fundamental canons offairness and service jurisprudence, he has earned laurels from the Governor. Did not Bank while making these appointments, actually act upon “list of failures”. If 582 candidates had requisite merit, why were they made to run from pillar-to-post and exposed to mental agony for 4 long years ? In what circumstances and to serve what purpose were more than 2000 Banking Assistants- a new cadre, appointed and that toothrough backdoor without giving a fair opportunity to all eligible candidates to compete for till then unknown positions? This all assumes significance in view of reportedly lowest per employee profit of the Bank. How can Bank go for recruitment spree in face of fragile deposit and advance growth and huge assets slippage, baffles the experts. These and like questions crave for an answer notwithstanding the recent rhetoric.
The Bank conceived in 1938 as an institution to serve the people has of late ceased to function with human face. While the Bank is all accommodative to the big business houses, it works like a traditional Sahokaar when it comes to small borrowers. Compassion is missing in case of poor but graduates into ecstasy when it is turn of crony capitalists. In the first place, small loans are not granted unless a government servant is produced as a guarantor and when a default occurs even due to circumstances beyond control like vis major, the salary of the guarantor is stopped, pushing his family to starvation and compelling him and his family to make the life of borrower miserable. In recent floods, number of cases came to surface with harrowing details where small entrepreneurs, with their tinyindustrial units submerged, were compelled to make distress sales of their small assets and at times residential houses, pushing them to the roadside. Same is true about militancy affected families where Bank refuses to go to the background stories no matter how painful these are and to show any mercy. The borrowers who owe crores and crores are extended huge loans even without any collateral while a small time borrower is made to hypothecate everything except his soul – from merchandise to livestock,to get a small loan.
The Bank is spending millions to resist the RTI Act and obstruct free flow of information. The RTI law is only second in importance to the Constitution. Same is true about judicial review and writ jurisdiction. Why should Bank be averse to giving access to information when it satisfies all the characteristics of public authority? In any case, sharing information is good for health of an organisation, as it encourages healthy suggestions from all those interested in its well-being. The aversion to information sharing indicates that everything is not good and there are things to conceal. Same is true about judicial review as it inter alia insulates the employees and all those having to do anything with the organization from whimsical, arbitrary and capricious action. The BCCI is a ready example.
To regain its past prestige and to rightfully claim the status of premier financial institution of the State and above all a symbol of its sovereignty, the Jammu and Kashmir Bank must promote transparency, develop compassion and volunteer to be amenable to RTI and judicial review. To inspire public confidence it must make public the details of all big defaulters who together are responsible for whopping NPAs. Each of the key stakeholders should take upon itself the role of a watchdog, all the time vigilant to point out any lapses in governance so that Bank maintains robust fiscal health. What was said earlier deserves to be repeated. Let the “skeletons” tumble down and “stink bugs” swarm out so that the mess is cleaned up, all responsible for the malaise unmasked and the Bank embarks on a journey to excellence.
(The author is former Judge of High Court and Senior Advocate Supreme Court of India)
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