The Indian Banks’ Association ( IBA ) has condemned the spate of chargesheets and arrests of bankers by investigative agencies and has called an emergency meeting on Friday in Mumbai to discuss the alleged high-handedness of the investigative agencies in alleged bank fraud cases.“To slap a criminal case against bankers for sanctioning loans is silly,” said VG Kannan, IBA CEO and former State Bank of India ( SBI ) official. “We have already taken up the matter with the department of financial services in Delhi and the Maharashtra government here. Both claim ignorance about why these arrests happened and have promised all cooperation. We plan to meet on Friday and decide what to do next,” Kannan said.On Wednesday, the Economic Offences Wing (EOW) of the Pune Police arrested Bank of Maharashtra (BoM) CEO Ravindra Marathe, former managing director Sushil Muhnot, executive director Rajendra Gupta and two other bank officials for allegedly colluding with real estate developer DS Kulkarni to divert money and cheat shareholders.All the officials were booked under various sections of the Indian Penal Code and the Prevention of Corruption Act amounting to cheating, forgery, criminal conspiracy, criminal breach of trust, and were remanded to police custody till June 27.Marathe and Muhnot are the latest to face the heat of investigative agencies. It all started in January last year when former IDBI chairman Yogesh Agarwal and four other executives were arrested in a case linked to the Vijay Mallya loan default.Former Canara Bank chairman RK Dubey, former United Bank of India chairman Archana Bhargava, former Punjab National Bank CEO Usha Ananthasubramanian and former IDBI executives Kishor Kharat, Melwyn Rego and MS Raghavan are also facing charges.Public sector bankers are furious and feel let down by the government for allowing agencies to treat public sector bankers without any respect. “It looks like a conspiracy to show public sector bankers in a bad light and in that way promote private sector banks. We have always seen even regulators treating private sector banks with kid gloves while wielding all the powers on us public sector banks. This has now gone so far that even investigative agencies are taking us for granted,” said a senior official at one of the public sector banks.Pune EOW sources claimed that bank officials misused their positions to sanction loans worth Rs 60 crore in two tranches. They alleged DSK Group diverted the said loans for personal use including renovation of the promoter’s house. Bank of Maharashtra claims its total outstanding exposure to DSK Developers is about Rs 94.52 crore which is fully secured by primary and collateral securities.“Recovery process like SARFAESI (Securitisation and Reconstruction of Financial Assets and Enforcement of Securities Interest) action has already been initiated by the bank and some of the properties are due for auction,” the bank said in a statement. “The bank has also declared DSK Developers and its promoters as wilful defaulters,” the bank said. Bankers said the arrests are shocking especially because the recovery process was underway.“At this rate, no banker will be willing to give loans. If we are being hauled up for a petty Rs 94-crore loan when we deal in hundreds of crores daily it just shows that there is a witch hunt on. Why would anyone want to take a lending decision when we are being treated this way?” said another banker.