DCB customers agitate against debt write-off

Bank says protesters are defaulters attempting to thwart recovery process

Several customers of the Development Credit Bank have started an agitation outside the area office of the bank in Ahmedabad, saying they were not informed about the bank writing off its debts. The agitating customers demanded that their outstanding loans be written off partially.

Bank officials, however, said the agitation is in fact an attempt by defaulters of the bank to thwart the recovery process that has been initiated.

Holding banners and raising slogans against the bank management, the agitating customers, who call themselves shareholders of the bank, have demanded the suspension of the Development Credit Bank area head V D Damle.

A customer, Barkat Wadhwaniya, said if the directors of the bank did not come from Mumbai to sort out their demands, two of the customers will immolate themselves in front of the bank.

Wadhwaniya said while the bank wrote off debts to the tune of Rs 120 crore in the past fiscal year, recovery action is being taken against customers who have outstanding loan amounts as low as Rs 25,000.

"All the loans recommended by V D Damle have turned into non-performing assets. The bank is not recovering amounts from bigger defaulters, but is targeting smaller customers," alleged Wadhwaniya, convener of the agitating customers.

Another customer, Mohammed Ali Khoja, alleged that in the past too, there was an instance of financial irregularities in the Ahmedabad branch of the bank, but, two officers found responsible for the irregularity were promoted.

When contacted, the bank's area head Damle said all the agitating persons are actually defaulters against whom recovery process has been initiated.

"As in every business, there are bound to be non-performing assets in banks also, and with our advances standing at over Rs 2,500 crore, there are bound to be some NPAs that will be written off," Damle said.

The agitators are not shareholders, but disgruntled customers, against whom recovery action has been taken, he said. The area head said the bank has asked one or two representatives of the customers to go to Mumbai and meet the directors of the bank including the managing director and resolve their grievances.

Sandeep Mookerjee, head, personal financial services, DCB, said, "DCB has net NPA of less than five per cent and a very strong capital adequacy ratio of 14 per cent. It is rated P1+ by Crisil and A+ by Fitch Ratings and has a sustained track record of profits."

But the agitating customers say since the bank was formed by merging several co-operative societies of the 'Ishamelis', and there is a provision for giving 'Ishmaelis' loans up to Rs 25,000 without any security, they should be given additional loans.

"One of our demands is that we must get loans of double the amount without security," said Salim Cassettewala, another agitating customer.