Friday, May 31, 2013

My Days West - Episode-20

Mahim was another branch that gave me the maximum operational comfort. Mahim station on the Western Railway is the third station from Santacruz after Khar and Bandra. The Western Railway used to run trains with a frequency of 3-5 minutes on two different tracks during peak hours even in those days!

The Senior Manager at the branch was totally surprised to see me for the second time in his branch. He was none other than the most ‘peculiar and innovative’ Manager I had ever met in my inspection career! He was the Manager I had met earlier at the legendary city of Ujjain. It appears that the bank had recognized his innovations (!) and had posted him back to Bombay with promotion. He exclaimed on seeing me, ‘oh! You are after me even in Bombay!’ I was getting myself prepared to witness more of his innovations. But I found, in due course, that unlike a comparatively newly opened distant branch like Ujjain, the Bombay city branches would not allow innovations simply because well-set procedures and practices were already in place. The first and foremost change I witnessed as compared to Ujjain was – the Manager was sitting in his cabin!

Once I completed the initial formalities of inspection, the Manager invited me to his cabin. He asked me to tell him what type of confidential report Selvaraj and I had given about his performance in Ujjain to our Department! As per him the CMD of the bank came on a special visit to the branch shortly after we had submitted our report! The CMD is said to have called for the inspection report and gone through it in the branch. The Manager had presumed that the visit had its roots in our nasty confidential report about his performance!

I told the Manager that the confidential report was prepared by Selvaraj and I was not aware of its contents. However, I told him that there could not have been any such serious and damaging observations to invite the visit of the topmost executive of the bank. I was aware that Khajuraho in MP had an airport even in those days. Many top executives used to visit the world-famous temples there in the guise of visiting the nearby MP branches including Ujjain - in the official capacity. The CMD’s visit could have been under similar circumstances. But the Manager had interpreted it otherwise as he was not happy with our observations, particularly mine.

As far as Mahim branch was concerned, I could not find any major irregularities in view of the ‘risk-free approach’ adopted by the Manager. The bank’s advances portfolio was totally in the safe hands of the innovative (risk) Manager! One of the innovative practices adopted was in the matter of noting down the sanctioned limits of the borrowers in the concerned ledger folios (master sheets). During my review of overdraft/cash credit accounts of the borrowers in the relevant ledgers, I found that in quite a good number of cases the credit limits noted were 25-30 percent less than the actuals. I could also observe that the liabilities exceeding such reduced limits were being recorded in the ‘discretionary register’ as overdrawings under the authentication of the Manager. On enquiry with the officer in-charge, I was told that the limits were noted as per the instructions of the Manager. The credit files and the loan papers were in the exclusive possession of the Manager and the officer was not privy to the actual details.

When I went to the Manager to discuss the issue, he immediately requested me not to disclose the actual limits to the officer. He had devised a wonderful strategy to keep the borrowers under check, by keeping them and the officer concerned in the dark about the actual limits sanctioned. To illustrate - he would get a sanction for a limit of Rs5 lakh to the party, but tell him that the limit is for Rs3 lakh only. The same limit is also noted in the ledger. He would also assure him that he would allow him overdrawings to meet his urgent needs as a special case. All drawings above Rs3 lakh are treated as overdrawings! The client would feel that the Manager is obliging him by allowing huge overdrawings at his request! But in reality he was operating well within his limits! I asked the Manager whether the party would not come to know the actual limit while signing the loan papers. The Manager simply smiled at me and told me that the question did not arise as the papers were invariably signed blank and filled up only later! I was simply flabbergasted!

In my role as an inspecting officer, I was expected to comment on:
  1. Judicial use of discretionary powers (emergency powers)
  2. Proper recording of such cases in the discretionary register and
  3. Proper recording/noting of the sanctioned limits in the master sheets of the ledger
In view of the innovative system adopted by the Manager as mentioned above, I had a tough time in deciding my comments. I leave it to the imagination of the readers as to the nature of comments ultimately made by me in my report!

At the end of the branch inspection, the Manager gave me a certificate (oral) that I had ‘matured’ as an inspecting officer and that I was very ‘raw’ when I visited Ujjain branch!  Years later, the Manager ended up in the inspection follow up section at Bangalore Circle office. I was posted as Manager, Corporate Cell, Cantonment branch. He was never sent for field inspection and retired at the Circle Office itself. I consider him as the most interesting (character) Manager I ever came across!
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B G Rao (BGR), my mentor at the Shimoga main branch, was posted to the Tamarind Lane branch in Bombay as Manager on promotion. He was allotted quarters in Mahim. I had continuously maintained my contacts with him by visiting him whenever I was in Bangalore. Our (family) association was revived again at Bombay.

I got the opportunity to inspect the Tamarind Lane branch during the year 1981. Our team was led by Vaitheeswaran, who had been just promoted as Manager. Vaitheeswaran was a very senior officer in Bombay inspection and was closely associated with Selvaraj. While he was knowledgeable and very friendly, he had the problem of getting stuck in his work-area. He started with cash credit accounts and was totally stuck there till we completed all other departments. His problem was he would engage in talking to his colleagues and branch staff during a major part of working hours!

Tamarind Lane branch had been actually carved out of the Fort branch as the business there had grown unwieldy. It was located at a walkable distance from the Fort branch near the famous Bombay House of the Tata Group . The branch had a good number of corporate accounts including that of L & T. The branch was handling all the public issues of various companies. BGR was assigned the job of handling this portfolio exclusively. He had a reputation for cleaning up the stables and setting up a well-organised structure wherever he went. He had done it in Shimoga main branch and Currency and Government Accounts section at Head Office earlier. That was exactly what he did in Tamarind Lane also. In his own typical methodical way he streamlined the entire set up.

An interesting incident took place when I was inspecting this branch. One day I saw a middle-aged man standing in front of the counter and staring at me. He was enquiring with the counter staff about me. The staff in turn told me that the gentleman wanted to talk to me. I went out and met him there. He mentioned my name and asked me whether I was from Bangalore. I confirmed my name and told him that my brothers were in Bangalore. The conversation continued as below:
Mr.X: I am related to your elder brother from his wife’s side.
Me: In what way?
Mr.X: I am related to her brother-in-law. I am settled in Hyderabad.
Me: You are related to Mr.Narasimhamurthy?
Mr.X: Exactly. He is my cousin. I visited Bangalore recently. We had a nice time and visited your brother at his residence in……….
Me: Chamrajpet?
Mr.X: Exactly.

At this point I took the person to a hotel near the branch and ordered tiffin for him. He told me that my brother had asked him to meet me whenever he was in Bombay. That’s why he had come to the branch to meet me. When we were coming out of the hotel, he suddenly told me that he was making some purchases for his sister’s marriage and was short of money for the purpose. He requested me to help him out!

The sudden request made me doubt the genuineness of the person. I just recalled the entire conversation right from the time I saw him at the branch. I could realize that the man was taking me for a ride! I told him ‘good bye’ and came back to the branch. Later I came to know that some of my colleagues also had similar experiences.

At the time of commencement of our inspection, Umesh Bhandari was the DM of the branch. He was transferred within a few days and Vishnu Prabhu from Byculla branch was posted as AGM. There was some time gap by the time he reported. In the intervening period I was asked to sit in the DM’s cabin for want of space in the branch.

One particular day a middle-aged man barged into the cabin and started firing me left and right! I could make out that he had taken me to be the head of the branch, which I was not! The cabin was at the entrance of the branch itself. I tried to explain to him that I was not the head of the branch and I was only inspecting the branch sitting in the ‘wrong’ place and that he was choosing a wrong target! But the person was not prepared to hear me. He was about to manhandle me, by which time the branch staff including BGR rushed to the cabin and saved me from physical assault!

Before anybody could make out what was the issue with the eccentric fellow, the police came in search of the person! It appears that the person had already created a similar scene in another bank branch in the locality. A police complaint had already been lodged against him and they almost caught him red-handed! The experience was quite unnerving for me.

The branch had a Manager by name Venkat (Venkatachala), who was in charge of establishment and staff matters. I knew Venkat right from his days as an officer at the A R Street branch. Venkat was a jolly man and was a fit person to handle public relations matters. His speciality was he did not know much about banking procedures and systems! As far as advances matters were concerned, they were just Greek and Latin for him! Of course Venkat never bothered about these minor issues! He just carried on with his typical friendly mannerisms and got his promotions through his public relations expertise. One of the portfolios assigned to him in A R Street was arranging Sumeet Mixies to the bank staff!

Venkat was under the impression that he was a stockmarket expert. He would invariably recommend certain scrips to those interested in share market without their specific request. I had heard him giving such unsolicited advices to several employees. I was very curious to know whether any of them actually acted upon his advice and made some money.

Tamarind Lane branch was located at a walkable distance from the Bombay Stock Exchange building and many of the staff members were experts in stock trading. The branch had a concurrent auditor by name Srinivasan. Srinivasan was a Chartered Accountant and a very senior person in our department. He carried much respect from all of us. One day I saw him hearing Venkat patiently with all the seriousness. I could make out that Venkat was recommending certain scrips to him as usual. Later I asked Srinivasan whether he really thought that the advice was worthwhile and he acted on it anytime so far and made some money. He smiled at me and told me that he indeed made money. Before I could express my surprise, he asked me to hear him in full. He explained to me that he was buying all the shares, which Venkat advised him to sell and was selling those shares, which Venkat wanted him to buy! He had observed that the market invariably moved against the advice of Venkat!

Being in-charge of staff matters, Venkat had to maintain the leave records of the employees. The branch had one particular employee who was in the habit of applying for frequent leave (mostly for one or two days). He had exhausted all the categories of leave other than casual leave (CL) to his credit and naturally he was expected to suffer loss of pay. But his colleagues were surprised to find him not exhausting his casual leave balance even after availing it for more than 15 days, even though the CL was available only for 12 days in a calendar year! The mystery was solved one fine day when one of the employees who had not at all availed the CL, checked the balance CL to his credit. He found that Venkat had already debited his account on more than five occasions! He was furious and asked Venkat to credit back his account immediately. Venkat was in a dilemma as he did not know how to reverse the entries as the other employee had fully exhausted his balance! Somebody advised him to allow overdrawings in the account and seek approval from the staff section!

Years later Venkat ended up at Cancard Division in Bangalore. I was working as Senior Manager in Trinity Circle, M G Road and had occasions to meet him. Venkat was in-charge of recovery and there was no necessity for him to handle any normal banking activities. That suited him well and he retired peacefully in the same Division. In my opinion Venkat was a typical example of how one could survive in a bank without bothering much about ‘banking procedures, systems and practices’.
------- (To be continued)
A V Krishnamurthy
9th October 2009

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