{"type":"rich","version":"1.0","title":"Pick of the day - Third whistleblower at ICICI Bank","description":"Last Friday, June 23rd, ICICI, India’s largest private lender, announced that it had received complaints about 31 loan accounts from an anonymous person, on which an enquiry was instituted. Subsequently, an interim report was submitted to the regulator. The complaint states that in addition to inflating profits, top executives, including CEO Kochhar and executive director Vijay Chandok, wilfully breached rules to avoid classifying certain loans as bad.\n\nThe new complaint, which was made in March of this year, claimed irregularities in the conduct of some borrower accounts, resulting in incorrect asset classification. The complaint cited 31 loan accounts in respect of which this was alleged. One of the allegations is that ICICI Bank inflated profits by at least $1.3 billion over eight years by delaying provisioning for NPAs.\n\nThe news outlet Mint noted that the complaint by the whistleblower, an ICICI Bank employee, which was made on 20th and 22nd March to the Reserve Bank and SEBI, alleges that the bank deliberately failed to set aside funds to cover 31 defaulting loan accounts between fiscal 2008 and March 2016. The complaint alleges the bank inflated profits primarily by underreporting the quantum of bad loans made to 31 companies, in which impairment was delayed, from a quarter to even up to five years. The third whistleblower also claimed ICICI has managed to delay provisioning for NPAs arising out of loans worth at least $3 billion. Provisioning for bad loans means that a bank must set aside a certain portion from its profits to compensate any likely loss caused on a loan. When a bank delays reporting the amount of its bad loans, its profit can appear inflated. Effectively, the bank would have reported losses in some quarters over the eight years, had the bank’s management not deferred impairment of loans, according to the whistleblower.","author_name":"Moneycontrol Podcast","author_url":"https://audioboom.com/channels/4937727-moneycontrol-podcast","provider_name":"Audioboom","provider_url":"https://audioboom.com","width":480,"height":95,"thumbnail_url":"https://audioboom.com/i/35219526/600x600/c","thumbnail_width":600,"thumbnail_height":600,"html":""}