SRINAGAR: Jammu and Kashmir bank has been brought under the ambit of Right to Information Act ( RTI ), the Chief Vigilance Commissioner ( CVC ) guidelines and the state legislature.

The State Administrative Council (SAC) under the chairmanship of Governor Satya Pal Malik approved the proposal for treating the J&K Bank Limited as a Public Sector Undertaking (PSU), official sources said.

The move is aimed to insulate the bank from political influence used for backdoor appointments and sanctioning massive loans to big business houses.

The PDP-led government under Mehbooba Mufti was accused of having appointed over 2000 undeserving candidates from backdoor in the bank besides having recommended bank loans of crores of rupees to her favourites including one of her Chennai based brother-in-law against disproportionate mortgage.

Interestingly, many of the valley hoteliers, who have defaulted to repay the loans have recently managed more borrowings from the bank and diverted the same loan amount to Dubai and other gulf countries for investment, the bank insiders told TOI.

The reports available with the bank reveal that there are hundreds of wilful defaulters from within and outside the state.

Governor Satya Pal Malik recently got appointed 582 candidates who had been dropped after clearing exams and interview and replaced with political appointees recommended by politicians during the Mehbooba Mufti government. Malik in an interview to one of the private news channels revealed that the bank was in a mess.

The bank's condition is so bad that its share value has dipped to Rs.39.5. Jammu and Kashmir government this year purchased its shares at Rs. 79 and invested more than Rs. 532 crore which raised the government's share in the bank to 59.3%, a top official at the state financial department said.

Established in 1938, J&K Bank is the only state government promoted bank in the country. State government has lost over Rs. 200 crore of its fresh capital investment in J&K Bank. The falling share price of the bank is giving jitters to the state government, the bank's majority stake holder. The net worth of the bank has drastically eroded by over Rs. 1400 crore, which, according to the finance department official, will be approximately 10 years future net profits of the bank.

However, chairman J&K Bank Parvez Ahmad disputed all the accusations. The condition of the bank is not as bad as other ten public sector banks like Bank of India, U.Co bank, Bank of Maharashtra, Central Bank of India and Punjab National Bank, he said.

"J&K Bank has also maintained absolute transparency and fairness in the recruitment process. There is no scope of any tinkering in the merit list prepared by the reputed national level professional recruitment agency, the Institute of Banking Personnel Selection (IBPS). The bank is open to public scrutiny on this."

