BENGALURU: The state government has kept its order stopping all transactions with the State Bank of India (SBI) and Punjab National Bank (PNB) on hold for 15 days after the banks sought time to resolve all issues.
“On August 16, both banks submitted written representations to the government, requesting a 15-day period to resolve the issues. The same day, senior bank officials met officials of the Finance Department and reiterated their request. After considering the banks’ request, the chief minister directed the officials to keep the circular in abeyance for 15 days,” said a statement issued by the government.
“This will give the two banks sufficient time to address the issues and redress the concerns of the government,” the statement said.
Based on the observations made by the Public Accounts Committee on July 2 and August 6, and the findings in the Comptroller and Auditor General’s report, the government decided to issue the circular directing all its departments to withdraw their deposits from all branches of PNB and SBI.
According to the statement issued by the government on Friday, the action was taken in view of the alleged fraud in some branches of the banks, which resulted in non-repayment of fixed deposits made by the Karnataka State Pollution Control Board (KSPCB) and the Karnataka Industrial Area Development Board (KIADB). Despite prolonged correspondence and meetings, these issues remained unresolved since 2012-13.
The government is committed to ensuring transparency and accountability in all its dealings, it will continue to monitor the situation and take appropriate action to protect the interests of all stakeholders, the statement said.