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C.R. Sukumar

HYDERABAD, Feb. 27

THE Charminar Bank Chairman, Mr Syed Alamdar Hussain Sajjad Aga, passed away at 8.45 pm on Tuesday night at a corporate hospital here.

Mr Aga allegedly shot himself with his personal revolver on Monday morning owing to a deep financial crisis at the bank.

His death shifts the focus on the fate of thousands of depositors of the bank. Concerns have been raised about urban cooperative banks in the State which are learnt to have deposited a couple of hundred crores in the bank.

Bombay Mercantile Bank, the Mumbai-based urban cooperative bank alone, had deposited around Rs 120 crore in Charminar Bank.

However, according to the officials of Registrar of Cooperative Societies (RCS) here, the Mumbai bank withdrew all its deposits recently.

While the 19 branches of Charminar Bank in the twin cities of Hyderabad and Secunderabad were partially operational during the last two days, all of them remained closed on Wednesday in the wake of Mr Aga'a death.

Meanwhile, the Government has directed the Crime Investigation Department (CID) to probe the role of the Mumbai underworld in the current crisis in Charminar Bank.

According to police sources, the CID teams would look into the accusation that the bank management had availed of the services of the underworld in mobilising deposits from urban cooperative banks across the State as well as some banks outside the State.

Having helped the bank get scheduled and multi-State status through deposit mobilisation, the underworld had allegedly mounted pressure on the management in the recent past to pay back the deposits of various urban cooperative banks, especially in light of the RBI probe into the bank records during the last quarter.

Having identified the major defaulters who were stated to have raised loans of around Rs 184 crore, the CID officials were directed by the Government to seize their passports immediately.

Cases have been booked against 12 of the bank directors under Section 420 and 409 of Indian Penal Code.

The RBI, which stepped into action on Tuesday, has ordered the branches of Charminar Bank to stop clearing loans and advances and not to release more than Rs 1,000 per depositor per day.

However, there were no restrictions imposed on the operation of lockers.

The RBI officials maintained that the deposits of almost all the depositors were safe.

Of the total 1,38,327 depositors, the deposits of as many as 1,34,848 depositors were below Rs 1 lakh, which were insured by the Deposit Insurance and Credit Guarantee Corporation. Only 3,479 persons have loans over Rs 1 lakh.

Meanwhile, the Government is learnt to have directed its departments not to risk placing their surplus funds in urban cooperative banks.

The Ministry for Minorities Welfare announced that the State Wakf Board had withdrawn its deposits of Rs 3 crore from Charminar Bank. The deceased chairman of the bank, Mr Aga, was one of the directors of the Wakf Board.

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