BGR Energy denies any malpractice in securing loan

Thursday, November 25, 2010

CHENNAI - City-based power sector engineering, procurement and construction company BGR Energy Systems Thursday said it did not resort to illegal or unethical means to get a Rs.500-crore working capital loan from Bank of India, whose official was taken into custody over an alleged loan scam Wednesday.

“We have no clue as to how our name got involved in the issue. Our total working capital loan from Bank of India is Rs.500 crore. We have utilised only Rs.20 crore of the fund-based limit,” P.R. Easwara Kumar, chief financial officer, told IANS.

“Our loan is standard asset and not an NPA,” Kumar said. The loan was sanctioned in 2008. According to him, the working capital loan was sanctioned by a consortium of banks, of which Bank of India was one.

Central Bureau of Investigation (CBI) had arrested the bank’s general manager R.N. Tayal Wednesday for allegedly receiving bribes while approving loans. Tayal was heading one of the bank’s large corporate branches in Chennai.

The finance ministry, meanwhile, has called from Bank of India details of three accounts pertaining to OPG Power, BGR Energy and Ashapura Minechem, officials said. Among these, Bank of India says only one has a bad or doubtful loan component.

Kumar also said his company had not dealt with financial services firm Money Matters — also under the probe lens — for handling or processing any investment or loan and that the same has been communicated to the investigative agency Thursday.

According to him, the firm’s outstanding working capital loan is around Rs.1,500 crore and the total sanctioned limit by the consortium of 20 banks is Rs.4,500 crore. None of the group companies had any dealings with Money Matters.

Filed under: Economy

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