In the ABG Shipyard scam case, the largest public sector bank SBI has issued a statement. The bank has said that it had lodged a complaint with CBI in November 2019 itself. According to the statement, ABG Shipyard was incorporated on 15 March 1985 and it was doing banking arrangement since 2001.
Became NPA in 2013
Consortium was arranged for more than 2 dozen lenders. The main bank in this was ICICI. At the same time, due to poor performance, the account became NPA on 30 November 2013. Many efforts were made to revive the company but without success. In March 2014, all the lenders restructured the account under the CDR mechanism. But the shipping industry was going through the worst recession ever. Due to which the operation of the company could not be revived.
E&Y had given the report
Due to failure of reconstruction, the account was classified as NPA in July 2016 with effect from 30th November 2013 retrospectively. Lenders appointed E&Y (Ernst & Young) as forensic auditors during April 2018. E&Y report was placed before the Fraud Identification Committee of lenders in 2019. The fraud was primarily related to misappropriation of funds, misappropriation, and criminal breach of trust.