Business India News

ICICI cries foul over Videocon loan row

ICICI cries foul over Videocon loan row

Mumbai (Maharashtra): In the wake of the ongoing controversy around the Rs 3,250 crore loan sanctioned to Videocon Group by the ICICI Bank, its Chairman M.K. Sharma claimed that attempts were being made to malign the reputation of the bank, its Managing Director (MD) and Chief Executive Officer (CEO).

Addressing a press conference here on Thursday, Sharma, while defending the loan sanctioned to the debt-laden company, said the ICICI bank’s Board had reviewed the internal processes and details of the exposure to the group.

He further noted that the share of sanction to Videocon was less than 10 percent, contrary to the media reports.

“Board has reviewed the internal processes for loans. The share of sanction to the Videocon Group is less than 10 percent and exposure to Videocon has gone down in percentage terms since” he said.

The chairman of the leading private lender further noted that in 2012, a consortium of over 20 banks and financial institutions had sanctioned facilities to Videocon Industries Limited, 12 of its subsidiaries and associates as co-obligors for a debt consolidation programme, and for the group’s oil and gas capital expenditure programme aggregating to Rs 40,000 crore.

“ICICI Bank’s current exposure to the group is part of the syndicated consortium arrangement; ICICI was not the lead bank for the consortium. It only sanctioned its share of the facilities aggregating to Rs 3,250 crore,” he said.

Sharma also ruled out the possibility of any special benefit granted to the borrower and said terms and conditions offered are similar to those offered by other banks of the consortium, who account for 90 percent of the role amount.

Media reports suggested that ICICI Bank had granted a loan worth Rs 3,250 crore to Videocon. However, concerns were flagged about the payment of the loan, as almost 86 percent of it (Rs 2,810 crore) still remains unpaid, and the Videocon account was declared a Non-Performing Asset (NPA) in 2017.

The controversy comes amid a number of banking scams that have been unearthed in the public sector bank space, particularly the multi-billion-dollar Punjab National Bank scam involving celebrated jeweller Nirav Modi and Gitanjali Group owner Mehul Choksi.(ANI)