With its non-performing assets (NPAs) shooting up to 48 per cent,  Pathankot-based Hindu Co-operative Bank’s directors have been placed under suspension for failing to perform their expected duties in a transparent and professional manner.

Informing this on Sunday, registrar, Cooperative Societies Punjab, Arvinder Singh Bains said the financial health of the bank has been severely eroded and interest of the depositors of the bank has been put at a grave risk.

He said following complaints, a detailed inquiry was got conducted by the joint registrar, Cooperative Societies, Jalandhar Division. This enquiry pointed out that Reserve Bank of India (RBI) while conducting the inspection of the bank has put the bank on notice under Self Corrective Action for the second consecutive year.

The bank had shown its capital risk adequacy ratio (CRAR) as nine per cent on 31 March 2017, but after the inspection of RBI it has been lowered to 0.68 per cent as the bank had not made the required provisions in its books of accounts.

The NPAs of the bank has shot upto 48% which is very high. Further, Board of the Bank indiscriminately extended financial benefits to certain selected defaulters by reducing interest rate and waiving off penal interest.

For instance, the Bank’s Board waived off penal interest of Rs 43.39 lakh in case of M/s Transworld Sellways, Rs. 26,49,321/- in case of M/s Sai Enterprises, Rs. 4,21,361/- in case of M/s SS Timber and Rs. 62,949/- in case of M/s Narinder Singh.

The Bank in fact has to recover 99.69 Crore of rupees from only 44 big defaulters. Hence, the management of the bank has woefully failed to protect the interests of the institution, its depositors, its members and share holders compelling the Department to step in and suspend the Board.

The deputy registrar, Cooperative Societies, Bhupinderjit Singh Walia has been appointed as administrator of the bank and he has assumed charge on 11th May.

The largest licensed urban bank of Punjab, the Hindu Co-operative Bank Ltd was registered in 1926 as a society. The RBI granted it license as an urban bank in 1982 and the bank is having five branches and one extension counter at a school. The main beneficiaries of the bank are low and middle income group people.