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| Invest in J&K Bank to loose money | | | Early Times Report | 5/18/2012 11:00:46 AM |
| Jammu, May 17: If you had invested Rs 10000 on shares of J&K Bank a month ago, you would have lost Rs 45. The value of your investment would have dipped to Rs 9555. The share has been put in cold bracket by the leading financial consultant companies, impling that your investment will not yield any result.
This is the state of affairs of the Bank, the premium financial institution of the State, which has 53 percent shares.
The poor financial status of the bank stocks are also on account of the fact that it's been debarred from public scrutiny. The management is trying to hold its control over it despite the fact that it has been declared a Public Property by the State Information Commission. Shaken by this judgment of SIC, the bank has decided to approach High Court.The Bank has not been an open institution like other financial institutuions of the country. The chairman, whose appointment is though cleared by the RBI, is always made on the recommendations of the State.
It has become a politicized post and the person who has been close to power of corridors are made chairman, so that government and influential people have their control over the management and its finances.
The Bank never had a reputed financial consultant nor a economist of the repute who could manage the affairs in a professional manner.
The only qualification of the last chairman was he was journalist at a financial magazine and the present chairman also doesn't figure as a prominent figure in the financial world.
It's because of this reason that allegations of financial irregularities suffer often. The PDP had leveled allegations that how a property much higher than the market rate was purchased at the instance of one of the directors of the Bank, who it alleged was close to none other than the Chief minister.
Not only that even CAG had pulled the banks management for its financial irregularities.
The Comptroller and Auditor General (CAG) of India has said that J&K Bank sacrificied Rs 180.82 Crores under One-Time Settlement (OTS) in five years ending March, 2011.
"This is indicative of fact that reduction in NPA was mainly through settlement under OTS rather than recovery of NPA through normal course," the CAG said in its report for the year ended March 31, 2011.
"By settling 6073 cases under OTS during the years 2006-11, the Bank apart from sacrificing interest to the tune of Rs 147.47 crore, sacrificed the principal amount of Rs 33.35 crore resulting in loss to that extent", it said in the report.
The Non-performing Assets has been allegedly created at the behest of the Bank's management and than they were bailed out by its concurrence also. |
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