Waryam Singh: The Man in Middle of PMC Bank-HDIL Muddle
Waryam Singh, chairman of PMC Bank, previously served as the director of HDIL.
Waryam Singh, chairman of PMC Bank, previously served as the director of HDIL.(Photo: The Quint)

Waryam Singh: The Man in Middle of PMC Bank-HDIL Muddle

On Tuesday, 24 September, the Reserve Bank of India (RBI) imposed restrictions on Punjab and Maharashtra Co-operative Bank but did not mention any specific fault-line.

However, soon after, reports suggested the crisis is rooted to loans extended by the PMC Bank which turned into NPAs.

Another couple of days down the line, a certain S Waryam Singh has emerged as someone who has had his fingers in both pies: PMC Bank, and Housing Development & Infrastructure (HDIL), the real estate firm which received the loans that turned sour.

Also Read : PMC Bank Fiasco: What Should Consumers Do to Salvage Their Savings

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Waryam-PMC-HDIL Link

Waryam Singh got appointed as the chairman of PMC Bank in January 2015 for a period of five years. This was, in fact, Singh’s second stint as the chairman of the lender. He had held the office previously from 1999 to 2005.

However, the more interesting facet is that in the intervening period of 2005-2015, Singh was one of the non-executive directors of HDIL.

While Singh did not serve PMC Bank and HDIL simultaneously at any point, according to a Business Standard report, Singh held 1.91 percent stake in HDIL till 2017, two years into his tenure at the beleaguered lender.

And, if that is not enough, the loans extended by the bank to HDIL pretty much join the dots.

Also Read : RBI Raises PMC Bank Withdrawal Limit to Rs 10,000 From Rs 1,000

The Befuddling Rs 96.50 Crore Loan

Earlier this year, Bank of India took HDIL to the Mumbai Bench of National Company Law Tribunal (NCLT) after the real estate firm failed to repay dues worth Rs 522 crore. The NCLT on 20 August admitted HDIL under the provisions of the Insolvency Bankruptcy Code.

Following this, HDIL challenged the NCLT order in the National Company Law Appellate Tribunal.

It is here that the PMC Bank stepped in to extend a fresh loan worth Rs 96.50 crore to HDIL, according to an Indian Express report. HDIL used this loan to pay off its debt to Bank of India under a one-time settlement scheme.

The fresh loan extended by PMC Bank was seemingly a bad financial move, given the fact that HDIL was already facing an insolvency case.

Waryam’s Extended Links

Waryam Singh's link with HDIL isn't a one-off thing, and documentary evidence suggests that his association extends to other branches of the Wadhawan Group, which owns the real estate firm.

A Moneylife.in report furnished official releases to show that he has been on the board and assumed other key roles in a number of Wadhawan’s group companies.

Singh's appointment in the two organisation's top posts also reveal the cracks in the framework of the RBI and other regulators in detecting a potential conflict of interest.

(With inputs from Business Standard, Indian Express and Moneylife.in)

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