Reserve Bank of India has reported that they had recently undertaken quick scrutiny in some banks to examine if the reasons for corruption could be attributed to systemic issues i.e. risk to the system independent of the bribery case and if absence of proper internal controls had provided opportunities for bribery. Further acting upon the press reports that appeared in November, 2010 regarding arrest of CEO, LIC Housing Finance Ltd. and some other persons in connection with allegation of receiving illegal gratification by senior officers of some Public Sector Banks and Financial Institutions for sanctioning loans, RBI undertook scrutiny of borrowal accounts of the groups at Punjab National Bank, Central Bank of India and Bank of India, which were stated to be under scanner of CBI. The outcome of the preliminary scrutiny did not reveal any systemic risk and lacuna in the loan sanctioning system and the relevant internal control system of serious nature requiring immediate specific supervisory or regulatory interventions.

This information was given by the Minister of State for Finance, Shri Namo Narain Meena in written reply to a question raised in Lok Sabha today.

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(Release ID :70854)