The RBI swung into action after it found irregularities in loan disbursement to real estate developer HDIL. It was found that the bank’s exposure to the realty firm was exceeding to the regulations. Also, the lender hid the NPAs of HDIL.
HDFC Chairman Deepak Parekh voiced concern over PMC bank case
HDFC Chairman called the crisis at the Punjab & Maharashtra Cooperative Bank (PMC) brutally unfair. There are regular loan waivers and corporate write-offs but no financial system protects the savings of common man. RBI’s capping the withdrawal limit for PMC bank at Rs. 25,000 has affected thousands of PMC bank customers whose money is stuck in the brank fraud and they all are common people.
HDFC Chairman highlighted stood for common man
Mr. Parekh further said that there was no sin in finance bigger than the misuse of the savings of the common people. He revealed his concern about absence of a robust system to protect the honest savings of common people. He stressed that trust and confidence were the backbone of any financial system and the power of ethics and values should be underestimated.
HDFC Chairman in support of the government
Mr. Parekh admitted that this problem could crop up across the globe. He called for efforts to encourage savings to grow credits. The savings at 30% of GDP is an indication of a declining trend over the past decade. Household savings is important for economy. He was speaking at the opening ceremony of the center of financial studies by B-School SP Jain.