This was a crisis in the making for the last three years. The genesis lies in GTB involvement in the Ketan Parekh securities scam of 2001 and the ouster of promoter Ramesh Gelli.
But general depositors and investors, have taken the balance sheets of GTB as the true picture of financial health of the bank. On March 31, 2003, GTB had deposits of Rs 6,921 crore and advances (loans) of Rs 3,276 crore. On its balance sheet, it showed gross non-performing assets of Rs 915 crore while total provisions (against bad loans) were Rs 268 crore.
Therefore sudden decision of RBI and Government of India to place GTB under Moratorium caught more than 8.5 lakh customers of the bank unaware and shocked.
Such crisis raises serious questions on the transparency in the private sector banks and the credibility of their financial statements.
Notification of Reserve Bank of India ... Click here
Countdown to moratorium ... Click here
What is in store for customers ... Click here
Clarifications from RBI, Indian Government
... Click here