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Last Updated : Apr 04, 2018 08:03 PM IST | Source:

ICICI Bank says no individual loans given to any of the 5 firms in Videocon Group

A Firstpost story had alleged that the bank had sanctioned a Rs 650 crore loan against the collateral of Videocon Group company Evans Fraser.

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ICICI Bank did not give individual loans to any of the five companies in the Videocon Group, the private sector lender informed the stock exchanges on Wednesday.

The bank's statement was a response to a clarification sought by BSE and pertained to a Firstpost story, which alleged that ICICI Bank had sanctioned a Rs 650 crore loan against the collateral of Videocon Group company Evans Fraser.

The loan amount was close to nine times Evans Fraser's total sales, according to the Deed of Hypothecation agreement that was accessed by Firstpost.


In its statement to the exchanges, ICICI Bank said that the consortium of lenders that it was a part of assessed the financials of Videocon Industries as well the consolidated financials of the Videocon Group.

"The structure enabled the consortium to pool the cash flow of all the obligor companies towards debt servicing. Accordingly banks in the consortium created their 'right' or 'charge' over the assets of all the obligor companies," India's largest private sector lender said in its statement.

As a result, the 12 associate companies of Videocon Industries were all made 'co-obligors' to the loan, which meant that they would be liable to pay up in case there was a default by the group.

According to the Firstpost report, Evans Fraser & Company India, which was a co-obligor to the ICICI Bank loan in 2012, had net sales of just Rs 75 crore in 2011 and a net profit of Rs 94 lakh.

The data accessed by the website was sourced from the Registrar of Companies (RoC).

However, in its clarification, the bank pointed out that the image used by Firstpost for the story was of a document that was not proof of an individual loan, as portrayed by the news website, but of the bank filing for its rights over the assets put up by Evans Fraser as collateral.

ICICI Bank's clarification comes amid allegations of impropriety by CEO Chanda Kochhar involving loans worth Rs 3,250 crore given in 2012 by the bank to the Videocon Group.

Videocon promoter Venugopal Dhoot was found to have had links with Nupower Renewables, which was owned by Chanda Kochhar's husband Deepak Kochhar.

Since 2012, Videocon Industries' loan accounts have been classified as non-performing assets (NPA) by most banks.

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First Published on Apr 4, 2018 08:00 pm
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