Officers' associations demand nationalisation of LVB

Officers' associations demand nationalisation of Lakshmi Vilas Bank

The letter to RBI Governor Das said that the officers fail to find a reason for identifying DBS India as the suitable entity to take over LVB

Lakshmi Vilas Bank branch in Mumbai. Credit: Reuters Photo

Three different bank officer associations have demanded nationalisation of embattled private sector lender Lakshmi Vilas Bank (LVB) -- which has been placed under moratorium by the regulator, RBI.

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"We demand that LVB must be nationalized in the national interest. RBI should scrap the scheme of amalgamation and set in motion the process of nationalisation of the bank. We also demand that the top executives of LVB be held properly accountable for running the bank to the ground," the letter to RBI governor Shaktikanta Das read.

The letter has been jointly written by the All India Bank Officers' Confederation (AIBOC), Indian National Bank Officers' Congress (INBOC), and National Organisation of Bank Officers (NOBO).

The associations, as part of their argument to nationalise LVB, has given examples of precedent banking bailouts. "It is pertinent to note here that in the past three decades, failed private banks have always been amalgamated with public sector banks, like in the case of Global Trust Bank, IDBI Bank Ltd, and Nedungadi Bank Ltd. Recently, during the Yes Bank crisis too, the SBI had to bail out the beleaguered entity at the behest of RBI," they said.

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We fail to fathom any logic or rationale on the decision of RBI to identify DBS India the most suitable entity to take over the Lakshmi Vilas Bank, it said, adding, "RBI owes this explanation to the people of the entire nation."