Mrs Riaz Laljee got over $0.9m bank loan

ISLAMABAD: The government owned bank in Pakistan through its Bahrain branch sanctioned $0.952 million loan to Mrs. Riaz Laljee despite the fact that the credit committee of the bank had rejected the loan application. However, the bank’s headquarters approved the loan in violation of the SBP rules and without approval of the credit committee.
The audit and inspection report of the State Bank of Pakistan, a copy of which is available with The News, reveals that the bank allowed a funded finance facility of USD 0.952 million to Mrs. Nazneen Laljee for a tenure of 5 years.
Riaz Laljee in his response said any loan or deposits in my wife’s name at any bank are always current and within rules and regulations
The bank in response to The News questions said: “The SBP inspection report is strictly confidential. The SBP has forbidden its disclosure in any manner without its prior permission. The SBP has also directed that under no circumstances should the bank disclose or make public in any manner this report or any portion thereof. In view of the above referred directives of the State Bank of Pakistan, we are unable to comment on your queries on SBP’s inspection report on Bahrain”.
The documents further reveal that the bank allowed funded facility to settle the applicant’s (Mrs. Laljee) facility availed from a UK-based bank against the mortgage of a property located in UK. However after receiving the application from Mrs Laljee for finance facility the credit committee of OBU-Bahrain discussed the proposal on 10-09-12. After reviewing the application the credit committee raised some concerns mentioned below.
“The branch has no knowledge of the borrower in terms of her KYC. Further, OBU-Bahrain could not verify the business activities of the applicant. No Procedure is in place at OBU-Bahrain to finance an individual against mortgage of property. The property is located in UK and it will not be convenient to raise loan from Bahrain. The applicant has not presented her financials and there is no coordination between the borrower, her solicitor and the bank counsel. Further the name of applicant’s spouse is on the list of NAB”.
Interestingly, the bank headquarters approved the loan on 17-11-12 in violation of the prescribed rules of the State Bank of Pakistan and released the amount within 11 days of the approval from headquarters.
The documents further reveal that the loan amount was released even before registration of bank’s charge on the mortgage property, which was created after two months of the release of the amount.
The State Bank’s audit and inspection report further mentions that the bank management did not even clarify under which laws unauthorised waivers of the bank’s credit policy’s requirement for personal guarantee of borrower and insurance of mortgaged property were also allowed?
The report further says that the bank was not authorised to sanction any loan to the applicant as the borrower had neither any business in Bahrain nor had any account in the country prior to obtaining the loan facility.
Mr. Riaz Laljee was sent a questionnaire last year about the said loan to which he responded the same day, “Any loans or deposits in my wife’s name at any bank are always current and within rules and regulations”.