View
231
Download
0
Category
Preview:
Citation preview
8/6/2019 Recovery of Magmt
1/17
C H A P T E R 1
Introduction
Banks were never so serious in their efforts to ensuretimely recovery and
consequent reduction of NPAs as
theya r e t o d a y . I t i s i m p o r t a n t t o r e m e m b e r t h a t r e c ov e r y management, be of f resh loans or o ld loans , i s centra l toNPA
management. This management process needs to startat the loan initiating
stage i tsel f . Effect ive management
o f r e c o v e r y a n d N P A c o m p r i s e t w o p r o n g e d s t r a t e g y . F i r s t r e l
a t e s t o a r r e s t i n g o f t h e d e f a u l t s a n d c r e a t i o n o f N P A t hereof
and the second is to handling of
loan del inquencies.The tene ts o f f inancia l sec tor refo rms were revol
ut ionarywhich created a sense of urgency in the minds of staff
of bank and gave them a message that either they perform or perish. Theprudential norm has forced the bank to look into the asset
quality.A d e b t f r o m a l o a n , c r e d i t l i n e o r a
c c o u n t s receivable that is recovered either in whole or in part after
ith a s b e e n w r i t t e n o f f o r c l a s s i f i e d a s a b a d d e b
t . I n a c c o u n t i n g , t h e b a d d e b t r e c o v e r y w o u l d c r
e d i t t h e "al lowance for bad debts" or "bad debt reserve"
categories,and reduce the "accounts receivable" category in the books.
1
8/6/2019 Recovery of Magmt
2/17
Not all bad debt recoveries are "like-kind" recoveries.For example, a
collateralized loan that has been written off may be partially recovered
through sale of the collateral. Or,a bank may receive equity in exchange for
writing off a loan,which could later result in recovery of the loan and,perhaps,some additional profit.
Recovery
Recovery is defined as the process of regaining and saving something lost
or in danger ofbecoming costs
.
Recovery is a key to the stability of the banking sector there should be no
hesi tat ion in stat ing that Indian
banksh a v e d o n e a r e m a r k a b l e j o b i n c o n t a i n m e n t
o f N o n -
Performing Assets (NPA) consider ing the over al l d i f f icul tenvironm
ent. Recovery management i s a lso l inked to thebanks interest
margins we must recognize that cost
andr e c o v e r y m a n a g e m e n t s u p p o r t e d b y e n a b l i n g l
e g a l framework hold the key to future health and
competitivenesso f t h e I n d i a n b a n k s . N o d o u b t , i m p r o v
i n g r e c o v e r y m ana ge me nt i n I ndi a is a n a rea r equ ir in g
expeditions andeffective actions in legal institutional and judicial
processes.B a n k s a t p r e s e n t e x p e r i e n c e c o n s i d e r a b l e d i f f i c u l t i e
s i n recovering loans and enforcement of securities charged withthem. The
exist ing procedure for recovery of debts due
t o b a n k s h a s b l o c k e d a s i g n i f i c a n t p o r t i o n o f t h e i r f u n d s i n u n p
roductive assets, the value of which deteriorates with thepassage of time.
8/6/2019 Recovery of Magmt
3/17
RECOVERY MANAGEMENT IN BANKST h e R e c o v e r y O f f i c e r m a y , b y o r d e r , a t a n y s t a g e o f
t h e execution of the certificate of recovery, require any person,and in
case of a company, any of its officers against whomor which the
certificate of recovery is issued, to declare onaffidavit the particulars of his
or its assets.](5) The Recovery Officer may recover any amount of debtdue
from the defendant by distrait and sale of his movableproperty in the
ma nn er la id do wn in th e Th ir d Sc he du le to the Income-Tax Act, 1961 (43
of 1961).
Use oflok adalatT h e H o n o r a b l e S u p r e m e C o u r t a l s o o b s e r v e d t h a t l o a n s ,
personal loans, credit card loans and housing loanswith less than Rs.10
lakh can be referred to Lok Adalats.
Int h i s c o n n e c t i o n , b a n k s ' a t t e n t i o n i s i n v i t e d t o C i r c u l a r
DBOD.No.Leg.BC.21/09.06.002/2004-05 dated August 3,2004
w h e r e i n t h e y w e r e a d v i s e d t o u s e t h e f o r u m o f
L o k A d a l a t s o r g a n i z e d b y C i v i l C o u r t s f o r r e c o v e r y o f l o a n s . Ba
nks are advised that they should preferably use the forumof Lo k Adalats fo r
recovery of personal loans, creditcardl o a n s o r h o u s i n g l o a n s w i t h l e s s t h a n R s . 1 0 l
a k h a s suggested by the Honorable Supreme Court.Banks, as principals, are
responsible for the actionsof their agents. Hence, they should ensure that
their agentsengaged for recovery of their dues should strictly adhere
tothe above guidelines and instructions.Complaints received by Reserve Bank
regardingviolation of the above guidelines and adoption of
a bus iv ep r a c t i c e s f o l l o w e d b y b a n k s r e c o v e r y a g e n t s w o u l d b
e
42
RECOVERY MANAGEMENT IN BANKS
viewe d s erious ly. Res erve Bank may c onside r imp osing aban on a
bank from engaging recovery agents in a particular area, either jurisdictional or
8/6/2019 Recovery of Magmt
4/17
functional, for a limited period.
Inc a s e o f p e r s i s t e n t b r e a c h o f a b o v e g u i d e l i n e s . S i m i l a r
supervisory action could be attracted when the High Courtsor th e
Sup rem e Cour t pas s str ict ures or impo se pena ltie sagainst any bank or
its Directors/ Officers/ agents withregardt o p o l i c y , p r a c t i c e a n d p r o c e d u r e r e l a t e d t o t h e r e c o v e r
y process.
3.5 Programs ofbank
Credit counseling
It is the process of education to borrower about howto avoid incurring debts that
cannot be repaid as also how toma na ge the de bt s bu rde n and
re pa yme nt co mm it me nt s inrespect of a number of debts. This process
is actually more43
RECOVERY MANAGEMENT IN BANKS
debt counsel ing than a funct ion of credit education.
Creditcounseling often involves negotiating with bank to establish adebt
management plan (DMP) for a customer. A DMP
mayh e l p t h e d e b t o r r e p a y h i s / h e r d e b t b y w o r k i n
g o u t a repayment plan with the bank. DMPs, usually offerreducedpayments, fees and interest rates to the borrower. Recoveryagents
refer to the terms dictated by the bank to de terminepayments or interest
reduction offered to customer in a debtmanagement plan.
Debt Management Programs
Once a customer has come under a DMP, the bankwil l close the customers
var ious accounts and restr ict anyfuture charges in the accounts. The most
common benefit of a DMP is the consolidation of multiple monthly payments
intoone monthly payment, which is usually less than the sum
of the individual payments previously paid by the customer.S o me
D M P s a d v e r t i s e t h a t p a y m e n t c a n b e c u t b y 5 0 % , although a
reduction of 10-20% is more common.
C H A P T E R 4
ICICI bank & its avenue
8/6/2019 Recovery of Magmt
5/17
To understand about this big bank, we need tounders ta nd ho w i t be came
so big a force to reckon with.
44
RECOVERY MANAGEMENT IN BANKS
IC I C I ( Industr ia l Credi t Investment Corporat ion of
I
ndia)promoted the ICICI bank in 1994 with its stake reducing to46% after
the IPO in 1998. ICICI is a well-known name inI n d i a a lo n g w i t h
IDBI
a n d w a s f o r m e d i n 1 9 5 5 a t t h e initiative of the World Bank,
Indian Government and IndianIndus tr ies . B ot h of thes e i nst itut ions
ha ve an exc ep ti on al brand-image and one of the highest possible
ratings
fromC R I S I L a n d o t h e r r a t i n g o r g a n i z a t i o n s . I C I C I c a n b e co
nsidered an ol igopol ist ic corporation along with IDB I . ICIC l i sted in
NYSE in 2000. In 2001 i t underwent a
t ightm a r r i a g e w i t h B a n k o f M a d u r a i n a s t
o c k - o n l y amalgamation.
ICICI Bank
8/6/2019 Recovery of Magmt
6/17
(BSE: ICICI) (formerly
IndustrialCredit and Investment Corporat ion of India
)
i sIndia's largest pr ivate sector bank in market capital i zat ion andseco
nd largest overall in terms of assets. ICICI Bank hastotal assets of
about USD 100 Bi l l ion (end-Mar 2008), anetwork of over 1308
b r a nc h e s a n d o f f ic e s , a b ou t 3 9 50 A T M s , a n d 2 4 m i l l i o n
c u s t o m e r s ( a s o f e n d J u l y 2 0 0 7 ) . I CI CI Ba n k o f fe r s a wi de ra n ge
of banking products andfinancial services to corporate and retail customers
througha variety of delivery channels a nd through its
specializeds u b s i d i a r i e s a n d a f f i l i a t e s i n t h e a r e a s o f i n v e s
t m e n t b a n ki n g, li fe an d n o n -l i fe i n s u r a n c e , ve n tu r e c a p i ta l a n d a s s e t m a n a ge m e n t . B u t th e s e
d a t a a r e d y n a m i c . I C I C I B a n k i s al s o th e la r ges t is s u er o f c r ed i t
ca rd s in In dia . .ICICI Bank has listed its equity shares on stock
exchangesat Kolkata and Vadodara, Mumbai and the National Stock
45
RECOVERY MANAGEMENT IN BANKS
Exchange of India Limited, and its ADRs on the New YorkStock Exchange
(NYSE).The Bank is expanding in overseas markets and hasthe largest
international balance sheet among Indian banks.The Bank now has wholly-
owned subsidiar ies, branchesand representa t ives off ices in 18
countr ies, inc luding
ano f f s h o r e u n i t i n M u m b a i . T h i s i n c l u d e s w h o l l y o w n e d s
u b s i d i a r i e s i n t h e U K , C a n a d a a n d R u s s i a , o f f s h o r e banking
units in Singapore and Bahrain, an advisory branchin Dubai, bra nches in Sri
Lanka, Hong Kong and Belgium,and r ep off ice s i n the US , C hina ,
United Arab
Emirates ,B a n g l a d e s h , S o u t h A f r i c a , I n d o n e s i a , T h a i l a n
d a n d Malaysia. In particular, the bank is targeting the NRI (NonResident
Indian) populationICICI Bank reported marked-to-market loss of $264million
as of January 31, 2008 following the USA subprimemortgage crisis.
4.1 Recovery management ofICICI bank
Here how it works
8/6/2019 Recovery of Magmt
7/17
D e f a u l t s a r e c l a s s i f i e d i n t o t w o b a s k e t s S o f t a n d Hard.
T h e b o r r o w e r s a r e s e g r e g a t e d i n t o b a s k e t s o n t h e ba sis o f t he
time per iod of default . The baskets are46
RECOVERY MANAGEMENT IN BANKS
usually on the basis number on the basis of number of days i.e. 0-30, 0-60,
0-120 and so on.
The soft basket is when the default is at early, usuallybelow 90 days.
The default shifts into hard basket i f i t is beyond 90days.
The ba nk se nds reminder mails and makes telephonecalls to the borrower
After several reminders if the borrower still shows nosign of paying up then the
bank sends an employee toborrower to personally remind him of the re-payment.
Even after the notice if the borrower ignores the banksends a legal notice
to the borrower.
If the borrower ignores the legal notice then the
banke i t h e r d e c i d e d t o w r i t e o f f t h e a m o u n t o r r e c o v e r t h
e amount.
The recovery process is most of the times outsourcedto an external
recovery agency.
T h e r e c o v e r y a g e n c y s e n d s i t s r e c o v e r y a g e n t s t o collect the
money from the borrower, under the supervisionof the bank.
T h e r e c o v e r y a g e n c i e s u s u a l l y g i v e t h e b o r r o w e r a s t i p u l a t e d
tim e per iod with in whic h t he amo unt has to berepaid back.
8/6/2019 Recovery of Magmt
8/17
In some cases, if the bank decides to use SARFAESI,2002, then the
recovery agency has to seize the assets of the borrower.
47
T h e r e c o v e r y a g e n t s e i t h e r m a n a g e t o m a k e t h e b o r r o w e r
p a y b a c k th e m o n e y o r i f th e S A R F A E S I A c tc omes into play the n
they auction off the seized assets of the borrower and pay the
bank.NOTE: I f borrow er di dnt reply for
bank notice, hence thesecur i t i zat ion and reconstruct ion of f inanci
al assets andenforcement of security interest act, 2002
(securitizationact) comes into play.
Securitisation act of2002
Discouraged by the results of debtors in fillingthe coffers of banks,
legislature enacted securitization
a n d r e c o n s t r u c t i o n o f f i n a n c i a l a s s e t s a n d e n f o r c e m e n t o f s e c
urity interest act (securitization act) w.e.f. 21st day
of J u n e 2 0 0 2 . T h e b a n k s w e r e e m p o w e r e d u n d e r s e c t i o n 1 3( 4)
of securitization act to take possession of securedassets of the
borrower including the right to transfer by wayof lease, assignment or sale for
realizing the secured asset.The role of the court was limited to challenge the
measuresunder section 13(4), by way of appeal, that too on deposito f
7 5 % o f a m o u n t c l a i m e d o n t h e n o t i c e u n d e r s e c t i o n 13(2) of
securitization act.
4.2 Article
ICICI Bank fined Rs500, 000 for rough recovery methods
A consumer commission has ordered ICICI Bank,
thec o u n t r y s l a r g e s t p r i v a t e s e c t o r l e n d e r , t o p a y a f i n e o f Rs
500, 000 for use of force by the banks recovery agent on
48
RECOVERY MANAGEMENT IN BANKS
a defaulting customer. The client who defaulted on loan
h a d a p p r o a c h e d t h e c o n s u m e r a f f a i r s c o m m i s s i o n i n D e l h i c o m p l
aining of use of force by the banks recovery
agents.H e a l l e g e d t h e r e c o v e r y a g e n t s i m p o u n d e d h i s ve
8/6/2019 Recovery of Magmt
9/17
hicle and beat a friends son with iron rods, mistaking himas the
defaulter.The Delhi Cons umer C ommiss ion ha s ord ered theb a n k to
pa y th e co mp la in an t , Ta pa n Bo se , Rs 50 0, 00 0compensation. (With
register to required arent and outfitsinde pendent are age nts the methods.
Recovery regardingIndia of Bank Reser ve the guidel i nes str ic tde spi te hi re scountry across)Other big lenders l ike Citibank and HDFC
Bank havealso dealt with consumer complaints about the strong-
armtactics of recove ry ag ents. The ba nks ofte n dis miss therecovery
agents when confronted with such complaints.Earlier, an ICICI Bank customer
in Mumbai committedsuicide after a lleged harassme nt by recovery agents.
Thebank later paid his family compensation of Rs15 lakh.Banks suf fer the
hi ghe s t de faul t ra te s o n it s "s ma ll -ticket personal loans" that are usually
below Rs50,000. Therates of default on these loans are 10 per cent, compared to2
per cent for credit card defaulters and 1.5 per cent for car loans. The bank isreducing its exposure in the segment--itnow has around 3 mill ion suc h loans.
Banks often run into
49
RECOVERY MANAGEMENT IN BANKS
trouble when recovery agents target defaulters for theserecoveries.
RECOVERY MANAGEMENT IN BANKS
voice pitch), and body language (body position, bodymovement) All or any of
these elements of non-verballanguage communicate some message
(whether intended or unintended by the communicator) to
thereceiver.F o l l o w i n g a r e t h e m a i n p r i n c i p l e s o f e f f ec t i v e communication, which could be followed by a recovery
agent(communicator) in communication with the debtor (receiver).
8/6/2019 Recovery of Magmt
10/17
T h e a g e n t s l a n g u a g e ( v e r b a l a s w e l l a s b o d y l ang
uag e) sho uld be civ i l a nd co urt eous , a s per the bank-specific
requirement.
The objective of the communication should be clear.
T h e l a n g u a g e u s e d s h o u l d b e c l e a r s i m p l e a n d cour
teous.
The language used should be easily understood by thereceiver.
T h e a g e n t s h o u l d b e w a t c h f u l a n d s e n s i t i v e t o t h e r e c e i v e r s
responses (including his/her bo dy la nguageas mentioned above).
Make sure that the non-verbal communication (or
bodyl a n g u a g e ) i s n o t a d v e r s e t o d e b t o r , t
h o u g h unintentional
2) Listening skill:
Listening is another skill which is recovery in process.A good recovery agent
should be a good communicator anda g o o d l i s te ne r. L is t e ni ng
r e f e r s t o a l l t h e w a y s i n w h i c h c o mm un ic a ti o n is b ei ng re ce iv ed
fr om the ot he r pa rt y a ndincludes not only hearing but also facial body
expressions,58
RECOVERY MANAGEMENT IN BANKS
attentiveness or lack of i t . Fol lowing are the requis i tes of good
listening, which help improve communication and makeif effective:
Hear attentively to what the debtor is saying. One mayhear, but not listen, if
he/she is distracted or inattentive.
Lack of listening conveys lack of regard/ respect for thecommunicator; hence it
should be avoided.
8/6/2019 Recovery of Magmt
11/17
Do not show impatience or haste while listening to thedebtor. You may
lose some important information thedebtor washes to say.
Do not show anger or disapproval, or other such facial/body expression, whi le
listening to the debtors poi t of view.
N o r m a l l y , c o m m e n c e s p e a k i n g o n l y a f t e r t h e o t h e r party has
finished speaking or making a point. Normallydo not interrup t. In o ther
words, interrupt only
whena b s o l u t e l y n e c e s s a r y , e . g . w h e n t h e p o i n t s b e i n g s po
ken are irrelev ant o r bec oming unduly le ngthy or controversial and
time is limited or is being exceeded.Also interrupt softly by saying words like
excuse me.
3) Inter-personal skill:Inter-personal skill refers to communication plus skillthat enhances the
relationship and understanding betweentw o o r mo r e p e rs o ns . I t
t h u s i n c l u d e c o m m u n i c a t i o n a n d listening skills, plus something more.
This something morewo ul d be ex pla ine d he re . Ge ne ra lly , pe rs on
relate to eachother favorably when they find support to their dignity,
self-respect, se l f-esteem, ideas and values. Establ ishing good
59
RECOVERY MANAGEMENT IN BANKS
inter-personal relationship with a person means establishinga rapport with
that person. Any transaction that enhancesthe self would be helpful for
better inter-personal relation.Conversely, any transaction that diminishes the
self is likelyto disturb the inter-personal relation. For instance, when
arecovery agent assumes a posture of superiority and belittlesthe debtor in the
communication process, the recovery agentis really making the recovery
difficult. Many recovery
agentswho think othe rwise and communicate/ behave rudely o r h a
r s h l y i n r e c o v e r y p r o c e s s m a y t u r n o u t t o b e m o s t l y c o u
n t e r -
p r o d u c t i v e o v e r a l l . F o l l o w i n g a r e s o m e o f t h e elements of
inter-personal skill for recovery agent :
8/6/2019 Recovery of Magmt
12/17
Communicate and listen pro perly and effective ly,as described in the
preceding paragraph.
Show empathy and respect to other party, not
withs t a n d i n g t h e f a c t t h a t h e / s h e d e b t o r t o t h e principal.
Do not m ake the debtor fee l anxi ous/ insecu re/threatened by your
communication verbal or non-
v e r b a l . O n t h e c o n t r a r y , t r y t o r e m o v e s u c h apprehensio
n, if any, of the debtor.
G i v e a l l t h e i n f o r m a t i o n t h e d e b t o r a s k s f o r i n c o n n e c t i o n
with the debt and its repayment. Thiswo uld he lp imp ro ve int er -pe rs ona l re la ti o n and also the recovery prospects.
2)
Persuasive skill:
60
RECOVERY MANAGEMENT IN BANKS
loan/advances agreements entered between the lenders andcreditors. Thus the
receivables in a loan/advances accountconnote the following essential
features:1)Existence of loan or advance agreement between
thecreditor and debtor.2)Due date on or after which the o bligation is
required tobe discharged by the debtor in favour of the creditor.In terms of the
arrangement between the creditorbanka n d t h e d e b t r e c o v e r y a g e n c y t h e f o r m e r a u t h o r i z e s t h e a
g e n t t o c o l l e c t s p e c i f i e d r e c e i v a b l e s f r o m t h e n a m e d deb
tors on or after the spec i f ied due dates. The requiredpart iculars
of the de bt or s an d rec ei va ble s to be co lle ct ed from them are furnished
by the bank to the agent, along withcopies of the relative loan agreements.Thus
8/6/2019 Recovery of Magmt
13/17
th e de bt re co ve ry ag en t is le ga lly au th or iz ed to collect the specified
receivables from the debtors on behalf of the principal:
1)
The loan agreement, and
2)The debt collection agency agreement.The procedure and processes of debt
collection,
codeo f c o n d u c t i n c o l l e c t i o n p r o c e s s a n d o t h e r r e g u l
a t o r y requirements that need to be complied with by the
recoveryagents are discussed in subsequent units.
Remitted collected funds:
The fun ds col lect ed fro m t he deb to rs sho uld be se ntdeposited by the
agent to the creditor periodically as per theagencyarrangement. Statement of col lect ions remitted
63
RECOVERY MANAGEMENT IN BANKS
should also be sent along with the remittance, preferably induplicate and
the copy acknowledged by the bank be kept
onr e c o r d b y t h e a g e n t , i n c h r o n o l o g i c a l o r d e r , f o r f u t u r
e reference. These statements of remittance will from the basisof claiming theagreed fee or commission by the agent fromthe principal in due course.
Book keeping ofrecovery management:
While each debt recov ery ag ent ma y dev ise hi s/her own accounting
and book keeping methods, he/she has
tot a k e c a r e o f t h e r e p o r t i n g r e q u i r e m e n t s o f i t p r i n c i p a l
. Further, book-keeping has to be sperate for each principal.IT fo llo wi ng
would constitute the minimum requirement of book-keeping for a
recovery agent.
1)
L i s t s o f d e b t o r s r e c e i v e d fr o m t h e p r i n c i p a l :
Col lect ion of receivables i s an going act iv i ty of a recoveryagent
who ma y rece ive the debto r l ists fro m the principa lfrom time to
8/6/2019 Recovery of Magmt
14/17
time. The debtor lists from the basis of agentsactivities and also the book-
keeping required. These shouldtherefore be carefully kept on record in
chronological order.
2) Ledger account ofeach debtor:
Showing the amountsof receivable collected and balance to be collected should
bek e p t i n c h r o n o l o g i c a l o r t h i s c a n b e m a i n t a i n e d i n
t h e c o m p u t e r a l s o . I t m a y b e n o t e t
h a t a l l t h e c o l l e c t i o n s / r e c o v e r i e s s h o u l d b e r e m i t t e d
t o t h e a b a n k . N o r m a l l y a g e n t c a n n o t a d j u s t i t s d u e s o n
a c c o u n t o f f e e against the recoveries made on behalf of the bank.
3 ) C o p i e s o f l o a n / a d v a n c e s :
Ag re em en ts be twe en th edebtors and the bank is obliged to keep
confidentiality of its64
RECOVERY MANAGEMENT IN BANKS
customers accounts and recovery and these should not bediv ul ge d to
third part ies without the customers sent. Assuch, a debt recovery
agent mu st ta ke a ll du e care to the required privacy and confidentiality as
regards the records of e a c h du e f ur ni s he d by t he ba nk a nd a ls o as
r e g a r d s t h e collections made remitted by him to the principal.
65
RECOVERY MANAGEMENT IN BANKS
After this Kaushik had no option to go to his local policestation and lodge
a complaint against that person, and Mr.Kaushik have also decided to put a
case against that personand HDFC bank in consumer court as well as civil
court.K a u s h i k h a s a l s o p o s t e d a c o m p l a i n t w i t h H D F C G
8/6/2019 Recovery of Magmt
15/17
rievance cell, docket no. TF22534017.Kaushik requests the concerned
authority to take someaction on this.
ABC bank:
ABC Bank had granted a personal loan of Rs.60,000t o X Y , a l o w e r m i d d l e c l a s s i n d i v i d u a l , f o r c o n s u m p t i o n
needs. T he loan was to be repaid in instal lments by XY.The loan
was without any tangible security and also withoutany third party
guarantee. The borrower XY could not repayin t im e so me ins ta l lm ents and
there fore the loan became overdue.The ABC B ank gave XYs Case to
Z recovery agent,along with other overdue loans for recovery. The Z
recoveryagent called XY a couple of times and also visited him at
hisr e s i d e n c e . A s X Y w a s n o t a b l e t o r e p a y t h e a m o u n t
i n defaul t , Z , used abus ive and harsh languages in f ront onXYswi fe and daughters to make recovery . Dur ing one of the v i s i ts to
XY s ho us e, Z an d h i s co l l ea gu es to ok a wa yforcibly some of the
things that were available in XYs housein front of his wife and daughters and
also used threateningl a n g u a g e f o r p a y m e n t o f t h e d u e s . X Y
f e l t v e r y m u c h h u m il i ate d a n d a l s o d e p re s s ed . B e in g u n ab l e to
repay the
67
RECOVERY MANAGEMENT IN BANKS
dues. XY committed suicide. He left a suicide note, blamingZ for harassing
him endlessly. He mentioned the abuses hehad suffered at the hands of Z before
his wife and daughters.He also mentioned the threat Z gave that he would sufferdireconsequences if he failed to repay the overdue
amount.F o l l o w i n g t h e s u i c i d e d e a t h o f X Y , t h e l o c a l p o l i c e a r re
sted Z and his col leagues ( who used to accompany Zdur ing his
visit s to XYs house) on c harges of a betme nt o f suic ide. A case was
also f iled against the ABC Bank, whichh a d t o p a y a n e x -
8/6/2019 Recovery of Magmt
16/17
8/6/2019 Recovery of Magmt
17/17
www.rbi.co.in
www.icicibank.com
www.iibf.org.in
70
[Abstract]
RECOVERY MANAGEMENT IN BANKS
- Mandar
71
project on recovery
Recommended