ICICI Bank may file consent plea in Videocon loan case

Plea agreement means settlement of case without main hearing when the defendant agrees to plead guilty in exchange.

Mumbai: Under the scanner of investigative agencies over allegations of quid pro quo, ICICI Bank is looking to file a consent plea with the Securities and Exchange Board of India (Sebi) to end the ongoing probe against CEO and managing director Chanda Kochhar in the Videocon loan case, according to a news report citing unnamed sources.

ICICI Bank refused to comment. A plea agreement means settlement of case without main hearing when the defendant agrees to plead guilty in exchange for a lesser charge or for a more lenient sentence and/or for dismissal of certain related charges.

While the bank in the case will conduct an independent probe, sources suggested the board doesn’t want to drag the case and is evaluating options to file a consent plea, the report said.

Sebi had issued a show cause notice to Chanda Kochhar for alleged violation of disclosure requirements under securities law in this case.

According to Sebi, Kochhar didn’t adhere to the code of conduct, which required the disclosure of any conflict of interest in the case involving Videocon Group and NuPower Renewables, a firm owned by her husband Deepak Kochhar.

A few days ago, ICICI Bank denied a news report claiming that Kochhar was sent on an indefinite leave and clarified that the bank chief had gone on a planned annual leave.

Last month, ICICI Bank had said it would institute an independent enquiry into the allegations raised by an anonymous whistle blower against Kochhar. ICICI Ba­nk in a regulatory filing had said the enquiry would be conducted by an “indep­endent and credible person” appointed by the bank.

A whistleblower by the name Arvind Gupta has ag­a­in floated allegations against Kochhar for allegedly best­owing undue favours on Essar Group’s Ruia brother for ‘round-tripping’ investme­n­ts into her husband Deepak Kochhar’s NuPower Group. All parties named in the wh­istleblower’s second letter to PM have denied allegati­o­ns as baseless and malicious.

The private lender had given Rs 3,250 crore loan to Videocon whose chairman Venugopal Dhoot co-founded a separate company, NuPower Renewables, with Deepak Kochhar. There was some possible quid pro quo in the grant of loans, the 2016 letter by the whistle bl­o­wer had alleged. The loans are now non-performing asset on the books of banks.

ICICI Bank has, however, backed its chief, calling the rumours “malicious and unfo­unded”.

On March 28, the bank’s board had iss­ued a statement that it didn’t find anything wrong with the way Kochhar conducted herself. The board had said in 2012, a consortium of over 20 ba­nks and financial institutio­ns sanctioned facilities to Videocon group (Videocon Industries and 12 of its subsidiaries as co-obligors) for a debt cons­o­­l­idation scheme and for the group’s oil and gas capital expenditure programme aggregating approximately Rs 40,000 crore.

The bank’s current exposure to Videoc­on gro­up is part of this syndicated cons­o­rtium arrangement and “it was not the le­ad ba­nk for this consortium and the ba­nk only sanctio­n­ed its share of facilities aggr­egating approximately Rs 3,250 crore, which was less than 10 per cent of total co­n­­sor­tium facility in April 2012.”

According to a recent bu­siness daily report, ICICI Bank chairman MK Sharma had conducted a probe but found no problems with the bank’s decision to fund the Videocon Group.

( Source : financial chronicle )
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