FIRs Against Bankers in Maharashtra Remain Intact Despite Chief Secretary's Directive

Despite instructions from the Chief Secretary of Maharashtra to withdraw the FIRs lodged against branch managers of Scheduled Commercial Banks in Dharashiv district, the FIRs remain in effect, according to sources. This has prompted concern from banking unions and raised questions about the independence of bank officers in the state.
(An FIR filed against bankers in Dharasiv district.)

Background of the FIRs

The District Collector of Dharashiv had filed FIRs against several branch managers of Scheduled Commercial Banks, citing their failure to meet targets related to social security schemes and priority sector lending. These FIRs are considered highly controversial, as they involve senior banking professionals who are required to follow stringent guidelines set by the Reserve Bank of India (RBI) and internal bank policies regarding loan approvals.

Opposition from Banking Unions

Banking unions, led by the All India Bank Officers' Confederation (AIBOC), have strongly opposed the move. In a statement, Nilesh Pawar, State Secretary of AIBOC, described the filing of FIRs as an “unprecedented case where external influence or coercion in the approval of loans is being institutionalised.” Pawar added that the FIRs pose a serious risk to the independence of banking operations, as they may force officers to approve loans against their professional judgment. He also warned that this could result in a rise in non-performing assets (NPAs) and overall financial instability.

In a letter addressed to Chief Secretary Sujata Saunik, AIBOC highlighted their concerns: “The recent actions taken by the State Government are both unwarranted and potentially damaging, with serious repercussions for the banking sector in Maharashtra.”

State-Level Intervention

The issue was brought to the attention of the Chief Secretary during the State Level Banking Committee (SLBC) meeting, where representatives of the banking unions urged for immediate action. The Chief Secretary instructed the District Collector of Dharashiv to withdraw the FIRs; however, as of now, the Collector has not complied, citing the absence of a formal written order. 

(FIR filed against SBI branch head in Tuljapur.)

Sources informed Kanal that the minutes of the SLBC meeting, which could serve as a written directive, have not yet been released. This delay is seen as a technicality that is preventing the withdrawal of the FIRs, further prolonging the uncertainty and tension within the banking community.

Coercion of Bankers

Union leaders and bankers have voiced growing concerns over the pressure being exerted on them, particularly with the upcoming state assembly elections. According to Nilesh Pawar, local politicians are allegedly increasing pressure on banks to expedite the approval of loans under social security schemes, even when eligibility criteria are not fully met. This situation has heightened fears of potential political interference in banking decisions, which could have long-term consequences on the sector’s financial health.

"The institutional coercion of filing FIRs for not completing loan targets adds to the already existing worries of bankers," Pawar said. “This practice threatens to disrupt the entire lending process and may lead to poor financial decisions that could further burden the banking system with bad loans.”

(AIBOC’s letter to the Chief Secretary of Maharashtra dated 28 August, 2024.)

In their letter, AIBOC urged the State Government to step in and issue clear directives to all district administrations to stop filing FIRs against bank officials in relation to loan sanctions. “We respectfully request the State Government to issue clear directives to all district administrations to cease filing FIRs against bank officers concerning loan sanctions,” the letter read. It also emphasised that bank officers must be allowed to perform their duties without fear of legal repercussions for decisions made in line with RBI guidelines.

The banking unions under the banner of United Forum of Bank Unions(UFBU) have already been protesting against the increasing incidents of violence against bankers in Maharashtra.

The union has warned that if this practice of filing FIRs persists, they will be left with no option but to resort to agitation, including strike action, to protest what they see as a misuse of power by local authorities. As the situation develops, many are waiting to see whether the State Government will intervene to resolve the issue and ensure that bank officers are not subjected to such legal actions.