Bank officers Association are getting monthly subscription of Rs.100 to Rs.200 from each member every month. In addition they will get levy of Rs.3000/ from each member in lieu of bipartite settlement signed on 27th April 2010. Members are happy or not, that is immaterial.
I think total accumulated fund of Officers Association in various banks will grow to hundreds of crores of rupees. This fund is not only enough to meet the usual traveling and staying expenses incurred by union leaders for various issues but also more than enough to meet even entire salaries of all union leaders.
As a matter of fact union leaders are more often than not, busy in union matters and hence they hardly do any work for the branch or office they are posted. It is pity that even officer community in general is not happy with their performance as union leaders. On the contrary their actual energy is lost in saving bad officers and seldom used for any gain for honest workers or for any relief to those honest officers who have been arbitrarily posted in critical areas or rejected in promotion processes due to ill motive of executives. They have failed in giving relief to officers who have been made scapegoat for fraud and irregular credit committed by corrupt officers.
In such position I am of the opinion that these union leaders should be removed from muster roll of the bank and bank should stop paying salary to these leaders. Instead such leaders should be professionally trained to serve the interest of officers who are associated with the union and they should be paid by their parent Union itself. In this way bank will save crores of rupees which are paid as salaries and perquisites to these non performing officers. Bank can use this saved money in creation of new jobs for hundreds and thousands of young unemployed persons. Besides, removing from bank’s duty, union leaders will have full time to think about their members. Since these leaders do only union activities, it will be right from all angle of consideration that their salary should be paid by union fund only.
In case officers do not agree to this proposal or they apprehend that their interest by outsiders will be jeopardized ,they should solemnly declare and take oath that they would not nominate any retired officer as their union leader in future and make best efforts to replace retired officers serving as union leaders with officers who are in service. Because leaders who are no more in service cannot fight seriously and devotedly for better interest of serving employees, rather they look into avenues to cheat serving employees and give maximum benefit to those who have either retired or resigned or removed from the bank. Latest settlement is the ideal example for such sorry state of affairs prevailing in Bank and pitiable position of officers compared to other employees working in Central Government offices or PSUs.
In addition to this they should be made accountable and punishable for any lapse on union activities and their performance should be judged by a group of hundred officers who are actively working in the bank. Expenses incurred by union leaders should be fully scrutinized by a team of at least ten Chartered Accountants and the certified balance sheet of union fund should be circulated among all members. Officer should also appoint some legal experts in each district or at least in state capitals to stop injustice perpetuated by bank management only because they know judicial proceedings in India is too costly and too much cumbersome and time consuming that one is constrained to bear with injustice.
Leaders will then learn a lesson, understand the importance of their role and at least not repeat the history of committing blunder of signing a agreement of wage revision which has instead of solving problems of their poorly paid members has created so many anomalies and tried its best to divide officers community by accepting various discriminatory rules like recovery from PF optees (leaving pension optees), causing loss to VRS optees, resignees, family pension takers, fitment of officers at the state of Rs23520 in scale III and that in scale IV at the same stage and so on. Not only this, many clerks will get better arrear due to this latest settlement compared to officers in junior or middle management. There is no Stagnation in any increment of Central Government employees in ay cadre as per latest Pay Commission Report, but it continues to deprive senior office of annual increment for none of their fault.
If we talk of other issues, it is worthwhile to mention here that management in collusion with violating even their transfer policies, misusing policy meant for rural posting framed by Government of India, misusing policy for posting in North East region, giving promotion to corrupt and flatter officers taking advantage of Interview marks (which an interviewer can give whimsically to make or mar the career of an officer of his choice) Union leaders is silent spectator of torturous treatment given to good officers who are real performers but who do not have time to flatter executives and provide costly gifts to their bosses.
There are thousands of officers who have been continuously working in villages, officers in Non Metros are transferred frequently form one region to other, one state to other and even one zone to other whereas officers posted in Metros are seldom transferred out of their parent state. There is a policy that upto scale III officers will not be transferred out of region but this policy is violated frequently and union leaders remain silent spectators.
There is a policy that an officer cannot work in a region for ten years continuously, management allows many to continue or adjust them back in the same place after giving a formal break of one month outside the state. Is this not enough to prove that there is reign of injustice under the umbrella of union leaders?
Banks are performing better and better despite man power constraints but the real fruits of this growth are hardly shared with junior officers who work hard day and night for the growth.
Reign of injustice prevailing in banking industry at all levels is due to the fact that union leaders are working in nexus with senior officers managing the affairs of the bank. Union leaders are more or less second side of the same coin which is known as that of management. Union leaders and higher executives in bank management are jointly looting the banking industry (there may be some exceptions)and hence they support each other's misdeeds. They jointly harass and humiliate an officer who opposes irregularities and ill works of bosses.
Munsi Prem Chand told, “Jab rakchak hi bhakchak ban jaye to nash nishchit hai” i.e. when protectors become damagers, destruction is unavoidable. And the perpetuation of reign of injustice is possible only because our legal system is not that much effective and quick as it should be. There is no fear in the mind of evil doers who are sitting at the helm of affairs. They do not fear police, they do not fear court cases because they know very well that they, by dint of money power can manage judges, and they can manage advocates and politicians. They know very well that that court will not be able to deliver justice even in two or three decades. This is why whimsical posting, transfers and promotion are taking place in banking industry without any sign of protest from so called union leaders. This is why IBA got success in committing day light robbery of bank employees Entire team of union leaders were silent spectators when Draupdi (bank employees) was facing chirharan in the hands of Kaurav team lead by Duryodhan( IBA I,e, Management)
As such, we have to first ascertain who are our well wisher and who are stabbing us in the back, who are our friends and who are black sheep. We have to distinguish between flatterer and real worker, we have to give respect to those who are working sincerely for us and we should have courage to condemn those who are beating us from the back. Who will save our life, our career, our pay scale, our status and dignity in the community of workers when our union leaders also talk of management's language, when they threaten of harsh action, when they are also trying to vacate the stay granted by Madras High court on recovery from PF optees?
Danendra Jain
Monday, June 28, 2010
Saturday, March 13, 2010
Who can salvage Bank
Can CMD like MVNair ensure long lasting good health of the bank with the help of bad General Managers? Can Mr. Nair portray attractive balance sheet for long without window dressing when his most of General Managers are corrupt, charge sheeted or facing CBI inquiry.
When General Managers are not of sound mind and spotless integrity, can they expect their juniors to be clean and loyal to bank? When executive holding top posts are not honest and loyal to the bank, honest and efficient junior officers in the field cannot dream of getting promotion and good posting.
This is a bank where promotions take place completely on the whims of Interviewer. Officers who do not toe the line of bosses are posted at critical places. Charge sheeted officers, General Managers, DGMs and AGMs in Mumbai or in any Metro are not transferred out of their home town. But officers belonging to other states who are not having any God father at Administrative offices are posted at such branches which were spoilt by flatter and corrupt officers and who left no stone unturned to keep boss happy through gifting of costly and precious items.
After all who can stop this unhealthy culture prevailing in a bank when person sitting at the helm of affairs are corrupt and shielded by God father in Banking Division in Delhi or RBI or Ministry of Finance. There are many Satyam like Raju in all banks. It is a matter of time when real exposure of these mischievous persons takes place. Yes it is true that by the time their exposure takes place career of many good persons will be spoilt, ruined and raped.
I have however no doubt that future generation will curse MVNair and blame his policy for the fate of bank, though MVNair as a man is very much effective, assertive and knowledgeable.
When General Managers are not of sound mind and spotless integrity, can they expect their juniors to be clean and loyal to bank? When executive holding top posts are not honest and loyal to the bank, honest and efficient junior officers in the field cannot dream of getting promotion and good posting.
This is a bank where promotions take place completely on the whims of Interviewer. Officers who do not toe the line of bosses are posted at critical places. Charge sheeted officers, General Managers, DGMs and AGMs in Mumbai or in any Metro are not transferred out of their home town. But officers belonging to other states who are not having any God father at Administrative offices are posted at such branches which were spoilt by flatter and corrupt officers and who left no stone unturned to keep boss happy through gifting of costly and precious items.
After all who can stop this unhealthy culture prevailing in a bank when person sitting at the helm of affairs are corrupt and shielded by God father in Banking Division in Delhi or RBI or Ministry of Finance. There are many Satyam like Raju in all banks. It is a matter of time when real exposure of these mischievous persons takes place. Yes it is true that by the time their exposure takes place career of many good persons will be spoilt, ruined and raped.
I have however no doubt that future generation will curse MVNair and blame his policy for the fate of bank, though MVNair as a man is very much effective, assertive and knowledgeable.
Sunday, February 28, 2010
Waiver of loan culture
Government has been using banks as convenient method for mobilization of rural votes since long. They are for this purpose announcing waiver of loan frequently. This time they have extended repayment period further for six months because they know very well that farmers have developed a habit not to repay the dues of the bank till government comes forward with new scheme of either waiver of loan or compromise scheme for delayed repayment. Gradually small traders have also developed this tendency not to repay the loan availed by them from banks.
As a result banks have either to waive the loan given to farmers and small traders or treat the bad account as standard account till government announces new relief scheme. There is no repayment culture and I am unable to understand how long this vicious circle of reckless and blind lending and then waiver of credit may help banks survive. How long concocted and window dressed balance sheet may help banks in portraying attractive picture in balance sheet.
To add fuel to fire government has allowed private banks to be established in all districts to act as local banks. Already numerous Regional Rural Banks and Cooperative banks are actively participating in rural credit and suffering from huge loss due to non-repayment culture created by vote bank politics of ruling party. Health of these cooperative banks is so bad that government has to keep interest free fund in these banks in many states and also prove capital to them to ensure survival of these banks on ventilator. Many cooperative banks have declared bankruptcy during last two three decades. Now addition of rural banks will add fuel to fire. Either these local banks will exploit the rural people by charging high interest rate or by keeping their properties or gold in mortgage as they used to do before nationalization of banks. Both ways it is farmers who will suffer and ultimately they will either leave farming or migrate to towns in search of labour oriented unskilled job or commit suicide or make the banks sick by not repaying the bank's loan.
I fail to understand why politicians of this country do not understand the ground reality and try to please farmers and banks by jeopardizing their health and killing them through slow poison. At present they talk of Indian growth story and speak with pride that Indian government is decoupled with sub prime crisis of America. They should know that due to high standard of living and low earning capacity most of the American used to take loans from banks for consumption and there were many bankers (Indian government is also increasing number of banks in rural areas through addition of newly conceptualized private local banks) who were ready to lend them though at higher rate of interest. But consequence of this unhealthy practice ultimately precipitated Sub prime crisis when banks started falling like playing cards and poor American started committing suicide or selling their blood for survival
Danendra Jain
Ganaraj Choumuhani Agartala 799001
1st march 2010
As a result banks have either to waive the loan given to farmers and small traders or treat the bad account as standard account till government announces new relief scheme. There is no repayment culture and I am unable to understand how long this vicious circle of reckless and blind lending and then waiver of credit may help banks survive. How long concocted and window dressed balance sheet may help banks in portraying attractive picture in balance sheet.
To add fuel to fire government has allowed private banks to be established in all districts to act as local banks. Already numerous Regional Rural Banks and Cooperative banks are actively participating in rural credit and suffering from huge loss due to non-repayment culture created by vote bank politics of ruling party. Health of these cooperative banks is so bad that government has to keep interest free fund in these banks in many states and also prove capital to them to ensure survival of these banks on ventilator. Many cooperative banks have declared bankruptcy during last two three decades. Now addition of rural banks will add fuel to fire. Either these local banks will exploit the rural people by charging high interest rate or by keeping their properties or gold in mortgage as they used to do before nationalization of banks. Both ways it is farmers who will suffer and ultimately they will either leave farming or migrate to towns in search of labour oriented unskilled job or commit suicide or make the banks sick by not repaying the bank's loan.
I fail to understand why politicians of this country do not understand the ground reality and try to please farmers and banks by jeopardizing their health and killing them through slow poison. At present they talk of Indian growth story and speak with pride that Indian government is decoupled with sub prime crisis of America. They should know that due to high standard of living and low earning capacity most of the American used to take loans from banks for consumption and there were many bankers (Indian government is also increasing number of banks in rural areas through addition of newly conceptualized private local banks) who were ready to lend them though at higher rate of interest. But consequence of this unhealthy practice ultimately precipitated Sub prime crisis when banks started falling like playing cards and poor American started committing suicide or selling their blood for survival
Danendra Jain
Ganaraj Choumuhani Agartala 799001
1st march 2010
Saturday, January 2, 2010
Beware of CMD of a Bank
• Why officers and employees are not transferred out from the Mumbai, Kolkata, Delhi, Bangalore, Chennai etc. and on the contrary employees of states like Orrisa, Bihar, and Jharkhand are frequently transferred out of their states even violating transfer policies?
• Why some officers are always given rural posting whereas some other officers are even promoted without rural posting violating government guidelines in this regard?
• Why some officers are allowed to work in their Metro towns for decades whereas officers of other small towns and villages are to change their place of working every year or alternate year without any incentive or compensation?
• Is there no punishment for those executives who indulge in corrupt practices and resort to whimsical transfers to keep away all employees who may prove hurdle in their money making process?
• Why RBI remains silent spectator of ill-motivated CEOs of banks and allows the malady in banks to accumulate?
• It is worthwhile to mention here that unhappy lot of employees cannot think for and make efforts to keep bank healthy?
• Is human resource not capital in real sense in Banking Industry and for some VIP CEOs of Bank?
• Why some officers are always given rural posting whereas some other officers are even promoted without rural posting violating government guidelines in this regard?
• Why some officers are allowed to work in their Metro towns for decades whereas officers of other small towns and villages are to change their place of working every year or alternate year without any incentive or compensation?
• Is there no punishment for those executives who indulge in corrupt practices and resort to whimsical transfers to keep away all employees who may prove hurdle in their money making process?
• Why RBI remains silent spectator of ill-motivated CEOs of banks and allows the malady in banks to accumulate?
• It is worthwhile to mention here that unhappy lot of employees cannot think for and make efforts to keep bank healthy?
• Is human resource not capital in real sense in Banking Industry and for some VIP CEOs of Bank?
Tuesday, December 22, 2009
Interest rate for small Borrowers
This refers to news that bankers are demanding freedom to decide interest rate for loan upto Rs.2.00 lacs sanctioned by them.
In 1969, banks were nationalized with sole objective of making it accessible to each Indian, each villager and each town dwellers. It was aimed to give relief to village farmers and small traders from the exploitation in the hands of local money lenders who used to charge heavy interest and who used to give unbearable pain to villages if they failed to repay the loan in time. Landed property of most of the villagers used to be under mortgage with local money lenders. Farmers usually under the burden of interest used to fail in repayment and as a result local moneylender gradually became land mafia in that village.
To stop exploitation, Government of India adopted Lead District approach almost fifty years ago in which lead bank in a district is given the responsibility of all round development of that district and banks are entrusted the duty to lend villagers as per their need to end exploitation by money lenders . In eighties, to give further boot up to development through micro finance , government introduced Service Area Approach in which each branch of each bank was allotted certain number of villages for absolute development of each village, each Panchayat under their service area. For this purpose each bank along with Block Development Officer (BDO) and Lead District Manager of each district use to frame service Area Plan in the month of January for the next financial year.
Such plan is approved by initially BLBC (Block Level Bankers Committee) and then by DLCC (District Level Consultative Committee). Execution of such annual plans is monitored by BLBC, DLCC and finally by SLBC. It is unfortunate that even after making more than 30 annual plans and monthly monitoring of the execution of plans by DLCC as also by SLBC , there is no actual development in the villages and it is pity that still villagers have to depend on local money lender for micro finance. Crores of rupees are spent every year in administrative expenses in implementation of said Lead District Plans and Service Area Plans
It is ridiculous that after lapse of more than three decades of lead bank approach and Service area approach, lenders are requesting Reserve Bank of India (RBI) to allow them to freely decide interest rates on loans below Rs 2 lakh to enable them
reach out to unbanked sections which are presently serviced by microfinance institutions and money lenders at high rates. It is rightly apprehended that interest rate will go up for finance made upto Rs.2.00 lacs to farmers. Banker however pleads that even the increased rate will be competitive with interest rate charged by local money lenders.
I would like to emphasize here that rates charged by banks for loan upto Rs.2.00 lacs is fixed by RBI and it is restricted to BPLR ( Benchmark Prime Lending Rate which varies from11.5% to 14.5% from bank to bank). It is worthwhile to mention here that bankers in general do not hesitate in financing to Corporate, big traders and manufacturers at rate much lower than BPLR rate.
I like to point out here that banks in general normally charge interest ranging from 8 to 9.5% on Home loans, 10 to 11.5% on vehicle loans, 9.5 to 11.5% on Education loans, 7 to 10% on export loans and so. It is bitter truth that more than three fourth of banks lending is at rates less than BPLR under corporate lending or retail lending schemes. Not only this banks are offering one after other discounts on such lending which is rates much lower than BPLR to increase their market share .Even RBI has been suggesting bankers from time to time to further reduce interest rates on vehicles and home finance to increase demand in the market.
I am unable to understand why bankers are demanding freedom for deciding interest rates for farmers.
Do they want to exploit the villagers in the same as money lenders?
Have they discarded the idea, objective and vision of Service Area Approach?
Have they honestly executed last thirty plans and more framed during last thirty years?
Are they ridiculing social objective of government of India?
As a matter of fact bankers have been charging more interest on loans upto two lacs in comparision to loans given to other sectors mentioned above.
Do they want to earn profit from small traders and give discount to big borrowers?
It is true that RBI will not agree to such proposals of the banks in fear of sharp public reaction against increase in interest rates for small loans. But demand made by banks for freedom to decide rate for small loans points towards their real attitude in lending to small borrowers. Their plea to give relief to small borrowers from local money lenders is nothing but deceptive and unreliable.
Demand for freedom made by bankers is against the core objective of bank’s nationalization, Lead Bank approach and Service Area Approach. Not only this it also proves that bankers and government agencies have been simply befooling villagers in the name of service area approach for last three decades and more and the ground reality is that small villagers are still facing exploitation in the hands of money lenders.
Now everyone is talking of Social Inclusion. Political leaders advocate social inclusion when they frame their political manifesto. Ministers cry for Aaam Aadmi when they deliver speech to attract voters. Economists and Banks sympathize poor villagers. Are they shedding crocodile tears for poor and small borrowers?
Mere opening of Zero Balance Accounts in bank or distribution of Rs.300 or Rs.400 as pension to old people cannot serve the purpose of social inclusion. Bankers need to come forward to extend small sized lending at rate lower than BPLR and to make up this loss they should charge a little bit higher rate on lending made for purchase of vehicles, flats , real estate developers and also to big manufacturers, exporters and other service providers and big merchants. Objective of social objective can be fulfilled not by greedy politicians but by bankers.
Moreover it must be kept in mind that if small traders and small farmers do not survive and do not leave in peace, the very existence and rise of big traders, corporate houses, industrialists and exports will be at stake. Entire capitalistic approach of ruling government will be proving disastrous when mass movement and violence is resorted by exploited class of people to demand justice and for their survival.
“Marta kya nahin karta”
Danendra Jain
23rd December 2009
In 1969, banks were nationalized with sole objective of making it accessible to each Indian, each villager and each town dwellers. It was aimed to give relief to village farmers and small traders from the exploitation in the hands of local money lenders who used to charge heavy interest and who used to give unbearable pain to villages if they failed to repay the loan in time. Landed property of most of the villagers used to be under mortgage with local money lenders. Farmers usually under the burden of interest used to fail in repayment and as a result local moneylender gradually became land mafia in that village.
To stop exploitation, Government of India adopted Lead District approach almost fifty years ago in which lead bank in a district is given the responsibility of all round development of that district and banks are entrusted the duty to lend villagers as per their need to end exploitation by money lenders . In eighties, to give further boot up to development through micro finance , government introduced Service Area Approach in which each branch of each bank was allotted certain number of villages for absolute development of each village, each Panchayat under their service area. For this purpose each bank along with Block Development Officer (BDO) and Lead District Manager of each district use to frame service Area Plan in the month of January for the next financial year.
Such plan is approved by initially BLBC (Block Level Bankers Committee) and then by DLCC (District Level Consultative Committee). Execution of such annual plans is monitored by BLBC, DLCC and finally by SLBC. It is unfortunate that even after making more than 30 annual plans and monthly monitoring of the execution of plans by DLCC as also by SLBC , there is no actual development in the villages and it is pity that still villagers have to depend on local money lender for micro finance. Crores of rupees are spent every year in administrative expenses in implementation of said Lead District Plans and Service Area Plans
It is ridiculous that after lapse of more than three decades of lead bank approach and Service area approach, lenders are requesting Reserve Bank of India (RBI) to allow them to freely decide interest rates on loans below Rs 2 lakh to enable them
reach out to unbanked sections which are presently serviced by microfinance institutions and money lenders at high rates. It is rightly apprehended that interest rate will go up for finance made upto Rs.2.00 lacs to farmers. Banker however pleads that even the increased rate will be competitive with interest rate charged by local money lenders.
I would like to emphasize here that rates charged by banks for loan upto Rs.2.00 lacs is fixed by RBI and it is restricted to BPLR ( Benchmark Prime Lending Rate which varies from11.5% to 14.5% from bank to bank). It is worthwhile to mention here that bankers in general do not hesitate in financing to Corporate, big traders and manufacturers at rate much lower than BPLR rate.
I like to point out here that banks in general normally charge interest ranging from 8 to 9.5% on Home loans, 10 to 11.5% on vehicle loans, 9.5 to 11.5% on Education loans, 7 to 10% on export loans and so. It is bitter truth that more than three fourth of banks lending is at rates less than BPLR under corporate lending or retail lending schemes. Not only this banks are offering one after other discounts on such lending which is rates much lower than BPLR to increase their market share .Even RBI has been suggesting bankers from time to time to further reduce interest rates on vehicles and home finance to increase demand in the market.
I am unable to understand why bankers are demanding freedom for deciding interest rates for farmers.
Do they want to exploit the villagers in the same as money lenders?
Have they discarded the idea, objective and vision of Service Area Approach?
Have they honestly executed last thirty plans and more framed during last thirty years?
Are they ridiculing social objective of government of India?
As a matter of fact bankers have been charging more interest on loans upto two lacs in comparision to loans given to other sectors mentioned above.
Do they want to earn profit from small traders and give discount to big borrowers?
It is true that RBI will not agree to such proposals of the banks in fear of sharp public reaction against increase in interest rates for small loans. But demand made by banks for freedom to decide rate for small loans points towards their real attitude in lending to small borrowers. Their plea to give relief to small borrowers from local money lenders is nothing but deceptive and unreliable.
Demand for freedom made by bankers is against the core objective of bank’s nationalization, Lead Bank approach and Service Area Approach. Not only this it also proves that bankers and government agencies have been simply befooling villagers in the name of service area approach for last three decades and more and the ground reality is that small villagers are still facing exploitation in the hands of money lenders.
Now everyone is talking of Social Inclusion. Political leaders advocate social inclusion when they frame their political manifesto. Ministers cry for Aaam Aadmi when they deliver speech to attract voters. Economists and Banks sympathize poor villagers. Are they shedding crocodile tears for poor and small borrowers?
Mere opening of Zero Balance Accounts in bank or distribution of Rs.300 or Rs.400 as pension to old people cannot serve the purpose of social inclusion. Bankers need to come forward to extend small sized lending at rate lower than BPLR and to make up this loss they should charge a little bit higher rate on lending made for purchase of vehicles, flats , real estate developers and also to big manufacturers, exporters and other service providers and big merchants. Objective of social objective can be fulfilled not by greedy politicians but by bankers.
Moreover it must be kept in mind that if small traders and small farmers do not survive and do not leave in peace, the very existence and rise of big traders, corporate houses, industrialists and exports will be at stake. Entire capitalistic approach of ruling government will be proving disastrous when mass movement and violence is resorted by exploited class of people to demand justice and for their survival.
“Marta kya nahin karta”
Danendra Jain
23rd December 2009
Saturday, December 12, 2009
Uniform Interest Rate
Banks are dealing with money deposited by public. Banks are custodian of public deposit. They have got no moral right to lend only to achieve the target set by the management. Government cannot justify its action in courts when it promotes waiver of loans or compromise with recalcitrant and willful defaulters. Non performing assets in all banks have been rising year after year and banks cannot guarantee the correctness of their published balance sheets. Banks cannot justify lending without earning profit or offer whimsical discounts endangering the overall health and overall future of banks. At the same time banks cannot charge discriminatory rate of interest for different home loan borrowers, say old and new.
If all government funds are taken out from banks or at least become eligible for payment of interest by banks, I think most of the banks will face unimaginable loss or at least erosion in their profit. Even in such pathetic condition and poor health of banks, some of CMDs of banks are advocating for lowering of interest rate just to please a few ministers and shying away from accepting uniform interest rate.
Lowering of interest rate by weak banks just to meet the challenge posed by strong banks will tell upon the health of such weak banks and ultimately jeopardize the deposits made by common men. After all who has given banks right to play with public deposits as per whims and fancies of ministers and Government of India. If private banks instigate rate war it is imaginable, but the painful truth is that it is PSBs which are lowering rates without taking care of cost of fund and possibility of erosion in their profitability. In olden days private merchants were accused of labour exploitation. In the modern era banks are earning profit by reducing manpower and exploiting existing manpower. Anyway, if even weak bank collapses due to wrongful policies prevailing in the market or promoted by government, it is none other than depositors who will suffer the most.
As such it is the interest of banking community as a whole that interest rate is made uniform and the focus of bankers is made to concentrate on more and more lending. It is to be kept in mind that a person who is ready to avail loan of Rs.20.00 lac or more is least bothered of one or two percent higher interest charged to him.
If all government funds are taken out from banks or at least become eligible for payment of interest by banks, I think most of the banks will face unimaginable loss or at least erosion in their profit. Even in such pathetic condition and poor health of banks, some of CMDs of banks are advocating for lowering of interest rate just to please a few ministers and shying away from accepting uniform interest rate.
Lowering of interest rate by weak banks just to meet the challenge posed by strong banks will tell upon the health of such weak banks and ultimately jeopardize the deposits made by common men. After all who has given banks right to play with public deposits as per whims and fancies of ministers and Government of India. If private banks instigate rate war it is imaginable, but the painful truth is that it is PSBs which are lowering rates without taking care of cost of fund and possibility of erosion in their profitability. In olden days private merchants were accused of labour exploitation. In the modern era banks are earning profit by reducing manpower and exploiting existing manpower. Anyway, if even weak bank collapses due to wrongful policies prevailing in the market or promoted by government, it is none other than depositors who will suffer the most.
As such it is the interest of banking community as a whole that interest rate is made uniform and the focus of bankers is made to concentrate on more and more lending. It is to be kept in mind that a person who is ready to avail loan of Rs.20.00 lac or more is least bothered of one or two percent higher interest charged to him.
Wednesday, December 9, 2009
Wage Revision and Performance
Government has put stress on salary packages of employees of public sector banks to have performance linked variable component from next financial year. They could not ensure performance in central and state government departments but bent upon linking wage revision of bankers with performance knowing very well that it is still banks where work flows smoothly compared to other departments of government.
Government should first define performance, explain how to measure performance of various segment of officers and non officers, how to ascertain degree of customer service extended by a bank employee, how to correlate deposit mobilized by an officer with non performing assets (NPA) created by him before advocating performance based pay hike or incentive (PLI) to be introduced in public sector banks. There are numerous officers in banking industry who by paying bribe to government departments could mobilize handsome deposit to become performer but who endangered crores of rupees of banks by lending huge money to ineligible borrowers or to fake borrowers or who were found to be indulged in fraudulent activities.
Bitter truth is that an officer in general is treated star performers by an executive is later charge sheeted by another set of executive when exposure of irregularities created by so called star performers takes place or when top executive sitting at the top post do not like the said star performer.
There is already promotion policy in vogue in all banks which promises promotions based on performances. But the ground reality is that promotions are never given based on performances. Those who are flatterers, who are yes-man of bosses, who earn through bribe and share with bosses, who please bosses with cash and gifts are normally given better marks in Interview and selected for promotion. Similarly top officials are tactful enough to use good officers to clean the malady created and accumulated by their yes-men and justify the promotion given by them to a bad performer at the cost of good performer. If a honest and sincere survey is conducted on bank officers, the outcome will definitely reveal the large scale annoyance of bank officers with their top management and exposes injustices in promotion process. One cannot deny that promotions said to be performance linked in banking is absolutely whimsical and in no way related to work done by any officer.
In a bank it is very difficult to ascertain and measure work done by an employee and make it comparable with others. Different employees in different departments in banks at different branches and different administrative offices require different skill and unique level of handling. Every one is not competent to handle auditing work and similarly every officer is not tactful and efficient enough to handle a branch as Branch head. There are some officers who can be good faculty member in a training college but fail completely when they are posted in a branch and instructed to perform routine work in a branch.
Secondly, position, potential and work nature of a branch differs from village to village and from town to town. Quality of work at administrative offices is entirely a different story because administrative offices need no service to customer but only service and flattery to bosses. In brief each branch and each officer has a different characteristic and need unique treatment, different set of knowledge level and absolutely unique behavior.
I am unable to understand how bank management will justifiably quantify the work done by different segment of workers. It is rather bank management who can easily make or mar the career of any officer or a branch manager just by posting him at normal or critical branch, or by increasing or reducing manpower compared to normally required strength of manpower for a particular branch. Manpower provided to different branches is not uniform and more or less depends on the whims and fancies of higher bosses. An officer in good book of a boss can get surplus manpower whereas another officer when posted at same branch will be deprived of even normal strength of manpower.
There are many banks where even appraisal reports are not in vogue for assessing the work of award staff. Even for officer’s appraisal report is designed in such a manner that he or she is rated in different state in different way depending upon the likes and dislikes of the assessor. Even if appraisal reports on performance is written by his immediate boss, it has got no relevance in case of posting or promotion of an officer considered by the management from time to time. It is in banks that even guidelines for officers issued by government of India regarding Rural posting or North East posting related incentive is misused by the management to punish or isolate an officer who is not serving personal interest of the Boss.
If management wants to give performance linked incentive to any officer of their choice they will extend all cooperative hands and on the contrary they may pull back some good assisting workers from a branch to belittle good work done by a an officer who is though good performer but not in good book of his assessor. A man is not good or bad only because he is good or bad, but it largely depends on how the assessor or the judge perceives his performance. Attractive suit length in a cloth shop is liked by one but may be disliked by other.
Availability of suitable infrastructure and the potential of the area have greater role to play in performance of an officer. Similarly position of all branches is not same. There are branches, which are fraud ridden requiring skill in legal matter. There are branches where bad advances are huge and need focused attention on recovery of advances. On the contrary there are some new potential branches where in a year business rises to what 10 years old branch could not achieve in another town. Some branches are fifty years old having multifarious jobs and some are new requiring no special skill, some are situated in Naxal affected areas and some others are in business wise potential area. After all what will be the criteria for judging the performance of a bank employee which will be uniformly applicable and acceptable to all is a million dollar question.
It is seen in banks that charge sheeted officers are promoted based on caste or religion or closeness to bosses or based on recommendation of some God fathers or based on bribe he or she offers to top management in lieu of promotion he secures. There is no guarantee that the performance-linked incentive as contemplated by government of India will be used for real growth of banks.
As long as banks are unable to decide the framework and uniformly acceptable yardstick to measure the performance qualifying for incentive, mere introduction of such PLI in banks will undoubtedly create more conflicts, confusion and give rise to reign of injustice as perpetuated through promotions and posting by greedy and corrupt bank management in general, I do not talk of a negligible portion of exceptional good officials sitting at the top. Please excuse me. In general any power invested with Indian bosses produces nothing but gives rise to more and more corrupt practices and do not help in creating an environment conducive for real elevation of really good workers and real growth of banks. When incentive in form of promotion is not awarded judiciously, it is difficult to understand that the management will justifiably distribute Performance linked Incentives.
Danendra Jain
Ganaraj Choumuhani Agartala
9th December 2009
Government should first define performance, explain how to measure performance of various segment of officers and non officers, how to ascertain degree of customer service extended by a bank employee, how to correlate deposit mobilized by an officer with non performing assets (NPA) created by him before advocating performance based pay hike or incentive (PLI) to be introduced in public sector banks. There are numerous officers in banking industry who by paying bribe to government departments could mobilize handsome deposit to become performer but who endangered crores of rupees of banks by lending huge money to ineligible borrowers or to fake borrowers or who were found to be indulged in fraudulent activities.
Bitter truth is that an officer in general is treated star performers by an executive is later charge sheeted by another set of executive when exposure of irregularities created by so called star performers takes place or when top executive sitting at the top post do not like the said star performer.
There is already promotion policy in vogue in all banks which promises promotions based on performances. But the ground reality is that promotions are never given based on performances. Those who are flatterers, who are yes-man of bosses, who earn through bribe and share with bosses, who please bosses with cash and gifts are normally given better marks in Interview and selected for promotion. Similarly top officials are tactful enough to use good officers to clean the malady created and accumulated by their yes-men and justify the promotion given by them to a bad performer at the cost of good performer. If a honest and sincere survey is conducted on bank officers, the outcome will definitely reveal the large scale annoyance of bank officers with their top management and exposes injustices in promotion process. One cannot deny that promotions said to be performance linked in banking is absolutely whimsical and in no way related to work done by any officer.
In a bank it is very difficult to ascertain and measure work done by an employee and make it comparable with others. Different employees in different departments in banks at different branches and different administrative offices require different skill and unique level of handling. Every one is not competent to handle auditing work and similarly every officer is not tactful and efficient enough to handle a branch as Branch head. There are some officers who can be good faculty member in a training college but fail completely when they are posted in a branch and instructed to perform routine work in a branch.
Secondly, position, potential and work nature of a branch differs from village to village and from town to town. Quality of work at administrative offices is entirely a different story because administrative offices need no service to customer but only service and flattery to bosses. In brief each branch and each officer has a different characteristic and need unique treatment, different set of knowledge level and absolutely unique behavior.
I am unable to understand how bank management will justifiably quantify the work done by different segment of workers. It is rather bank management who can easily make or mar the career of any officer or a branch manager just by posting him at normal or critical branch, or by increasing or reducing manpower compared to normally required strength of manpower for a particular branch. Manpower provided to different branches is not uniform and more or less depends on the whims and fancies of higher bosses. An officer in good book of a boss can get surplus manpower whereas another officer when posted at same branch will be deprived of even normal strength of manpower.
There are many banks where even appraisal reports are not in vogue for assessing the work of award staff. Even for officer’s appraisal report is designed in such a manner that he or she is rated in different state in different way depending upon the likes and dislikes of the assessor. Even if appraisal reports on performance is written by his immediate boss, it has got no relevance in case of posting or promotion of an officer considered by the management from time to time. It is in banks that even guidelines for officers issued by government of India regarding Rural posting or North East posting related incentive is misused by the management to punish or isolate an officer who is not serving personal interest of the Boss.
If management wants to give performance linked incentive to any officer of their choice they will extend all cooperative hands and on the contrary they may pull back some good assisting workers from a branch to belittle good work done by a an officer who is though good performer but not in good book of his assessor. A man is not good or bad only because he is good or bad, but it largely depends on how the assessor or the judge perceives his performance. Attractive suit length in a cloth shop is liked by one but may be disliked by other.
Availability of suitable infrastructure and the potential of the area have greater role to play in performance of an officer. Similarly position of all branches is not same. There are branches, which are fraud ridden requiring skill in legal matter. There are branches where bad advances are huge and need focused attention on recovery of advances. On the contrary there are some new potential branches where in a year business rises to what 10 years old branch could not achieve in another town. Some branches are fifty years old having multifarious jobs and some are new requiring no special skill, some are situated in Naxal affected areas and some others are in business wise potential area. After all what will be the criteria for judging the performance of a bank employee which will be uniformly applicable and acceptable to all is a million dollar question.
It is seen in banks that charge sheeted officers are promoted based on caste or religion or closeness to bosses or based on recommendation of some God fathers or based on bribe he or she offers to top management in lieu of promotion he secures. There is no guarantee that the performance-linked incentive as contemplated by government of India will be used for real growth of banks.
As long as banks are unable to decide the framework and uniformly acceptable yardstick to measure the performance qualifying for incentive, mere introduction of such PLI in banks will undoubtedly create more conflicts, confusion and give rise to reign of injustice as perpetuated through promotions and posting by greedy and corrupt bank management in general, I do not talk of a negligible portion of exceptional good officials sitting at the top. Please excuse me. In general any power invested with Indian bosses produces nothing but gives rise to more and more corrupt practices and do not help in creating an environment conducive for real elevation of really good workers and real growth of banks. When incentive in form of promotion is not awarded judiciously, it is difficult to understand that the management will justifiably distribute Performance linked Incentives.
Danendra Jain
Ganaraj Choumuhani Agartala
9th December 2009
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