The Enforcement Directorate has charged five former employees of IDBI Bank for conspiring with beleaguered businessman Vijay Mallya in allegedly cheating the bank, which gave Kingfisher Airlines chief the loan in 2009.
The Enforcement Directorate (ED) has charged five former employees of IDBI Bank for conspiring with beleaguered businessman Vijay Mallya in allegedly cheating the bank, which gave Kingfisher Airlines chief the loan in 2009. The IDBI Bank employees are former chairman Yogesh Agarwal, former corporate banking head B. K. Batra, former general manager R. S. Sridhar, former deputy MD O. V. Bundellu, and former executive director S. K. V. Srinivasan, all of whom were booked by the CBI for authorizing loans to Kingfisher Airlines in January. They have been granted bail since. All five of them have been charged under Sections 3 and 4 of the Prevention of Money Laundering Act (PMLA), 2002. According to the ED, Kingfisher Airlines had a credit rating of BB, lower than the necessary rating of BBB which assesses the average credit quality in terms of risk. Despite this, IDBI sanctioned the company short-term loans of Rs 200 crore (as a bridge loan) and Rs 150 crore, and a corporate loan of Rs 750 crore.
The ED charge sheet says, “The net worth of the company was negative at Rs 316 crore as on March 31, 2008, and Rs 3,800 crore as on March 31, 2009, against the eligibility norms which required a positive net worth.” It also added that IDBI approved the Rs 900-crore loan to Mallya, which he refused to pay and then left the country, despite his weak credentials and the fact that he had been allegedly using the short term loan of Rs 4630 crore acquired by other banks for long-term goals.