The Hindu : Bank to probe depositors' run

Online edition of India's National Newspaper
Tuesday, Apr 15, 2003

Business

Business

Bank to probe depositors' run

MUMBAI APRIL 14 . ICICI Bank is planning to set up an expert committee to go into the origin of the crisis that led to the depositors' run on the bank over the weekend, according to ICICI Bank Director (Credit), P. Mukherjee. A probe would be initiated at the top level in order to find out the reasons that led to rumours of a liquidity crisis at the bank and take corrective steps accordingly, Mr. Mukherjee told UNI here today.

"Its a great lesson for all of us and we survived because of our large asset base,'' he said adding that the bank saw panic withdrawals of around Rs. 250 crores in the past two days.

According to senior officials in the bank, it was more of a "logistical crisis'' rather than systemic failure that led to jittery depositors queuing up in large numbers outside the bank's branches and ATMs to withdraw their money.

The bank could get over the crisis and initiated the necessary measures within the shortest time to instil confidence among the customers.

"In fact, State Bank of India and Bank of India came with assistance by opening up currency chests in local areas much earlier than the usual official timings,'' said Mr. Mukherjee.

Mr. Mukherjee said the bank had set aside cash of Rs. 2,500 crores for meeting the withdrawal requirements of customers and stationed agents round the clock at the ATMs to see that not a single centre suffered from lack of cash.

There were speculative reports in the stock market that ICICI Bank had a huge exposure to Infosys stocks which crashed by 41 per cent following the IT bellwether announcement of its "not so impressive'' financial results and subdued forecast last week. — UNI

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