The Central Bureau of Investigation (CBI) has started the process of examining the documents of those public sector banks which had provided loans to real estate firms by side-stepping established procedures.
Prior to this, the CBI had registered a PE to scrutinise the role of public sector banks that provided loans to companies who were allocated 2G spectrum in 2007-08, including Uninor and STel.
The PE was registered on grounds that some banks had allegedly violated the prescribed norms and provided finances to two real estate companies who made forays into the telecom market by procuring the spectrum auctioned during the said period.
According to the PE, the banks provided loans worth over Rs 115 billion to two real estate companies while discounting the risk factors, given that the Central Vigilance Commission (CVC) had already registered a case in the 2G scam and the CBI had begun its probe.
The public sector banks allotted Rs 100 billion to Unitech and Rs 15.38 billion to STel, based only on the licence papers issued by the Department of Telecommunications (DoT).
A major part of the Rs 100 billion loan to Unitech was disbursed by the State Bank of India, which provided a loan of Rs 80.50 billion to the operator during 2009-2010.
The other banks which provided funds to Unitech were Corporation Bank, Allahabad Bank, South Indian Bank, Canara Bank, Oriental Bank, Central Bank of India, Punjab National Bank, Standard Chartered Bank and Yes Bank.
STel obtained the Rs 15.38 billion loan from IDBI and IDBI Trusteeship Services Limited between July and November 2009.
Meanwhile, the Indian Banks? Association, led by O.P. Bhatt, chairman, State Bank of India has approached the Reserve Bank of India (RBI), seeking intermediation in the Supreme Court-ordered probe.
The consortium put forward the arguement that business may get severely disrupted if the RBI does not co-ordinate with the CBI on this issue.
