ICICI Bank resumes warehouse receipt financing

ICICI Bank resumes warehouse receipt financing

BS Reporter / Mumbai June 18, 2007

ICICI Bank has resumed financing against warehouse receipts after filling the gaps in risk management practices. In 2006, the bank was defrauded of about Rs 200 crore at central and state government warehouses in Kolhapur district, where it had not engaged third-party collateral managers.

It has now appointed collateral managers even for government-owned warehouses as it does for warehouses owned or managed by private companies, according to ICICI Bank officials, who did not want to be identified.

The fraud was made possible because of collusion between the parties involved as the bank found lesser quantities of commodities than mentioned in the warehouse receipts issued.