HomeLoanThis top banker once refused loan to friend Vijay Mallya for interesting reason
This top banker once refused loan to friend Vijay Mallya for interesting reason
July 14, 2019
Leading private lender HDFC Bank once declined a request for loan from now-fugitive businessman Vijay Mallya, Aditya Puri, MD & CEO, HDFC Bank said Wednesday at an event in Mumbai. There is a need to separate friendships from banking and this is what the bank followed while turning down the loan request, HDFC Bank chief said as he stressed upon the need to have a clear thinking about lending and risk management, news agency PTI reported.
“If you are a bad risk, you are a bad risk. You can be my good friend, I can give you coffee and send you away. Just for your information, they (Mallya’s officials) came to me for a loan and I gave them coffee and told them that I will consider the loan. And then Paresh turned it down,” PTI reported the HDFC Bank chief as saying at the event.
Earlier this year, a Mumbai court had declared Mallya as a fugitive economic offender (FEO) on a plea of the Enforcement Directorate, making him the first businessman to be declared such under the provisions of the new Fugitive Economic Offenders Act. Any individual against whom warrants for arrest is issued for his involvement in select economic offences involving amount of at least Rs 100 crore or more and has left India so as to avoid criminal prosecution can now be termed as fugitive economic offender.
The former liquor baron’s request was turned down by Puri’s colleague Paresh Sukthankar who actually declined the loan to Mallya, he also said at the event. Adding, he said that since lender works on such a clear thinking, the bank’s stock has one the highest premia across global banks. The private lender is also known to have one of the lowest NPA ratios in the industry, PTI also reported him as saying.
HDFC Bank shares were trading at Rs 2,410.40, up 22.75, or 0.95 per cent on BSE at the time of reporting.