Amid the swirling allegations over an alleged Rs 250 crore fraud at Karnataka’s second-largest UCB- Tumkur Grain Merchants Cooperative Bank’s General Manager Rajashekar N. has refuted the charges, describing the allegations as ‘baseless’ and an attempt to tarnish the bank’s image.
Speaking exclusively to this Indian Cooperative correspondent, Rajashekar said, “Out of the alleged Rs 250 crore fraud involving over 20 accounts, Rs 158.80 crore pertains to accounts that have already been closed and recovered. The remaining accounts are currently under recovery proceedings through the SARFAESI Act”.
“Most of these accounts turned NPA during the COVID period due to severe economic disruptions. Since then, we have recovered a significant portion of the outstanding dues. Importantly, since 2021, there have been no fresh slippages — no new accounts have turned NPA”, he added.
He asserted that the bank has been cooperating fully with the probe authorities and is confident that the truth will prevail. “The investigation is ongoing, and we are confident that we will come out clean. More than 64 inquiries have already been conducted. Despite the negative propaganda, we remain committed to transparency,” he added.
Responding to the accusations made by G.S. Basavaraju, the complainant in the case, Rajashekar accused him of deliberately tarnishing the bank’s image. “Basavaraju has been running a negative campaign against the bank across various platforms. He has lost five consecutive elections and is now targeting the bank out of sheer political vendetta. Our operations are transparent, and the depositors’ money is absolutely safe,” he said.
On the issue of Basavaraju’s removal from the bank’s shareholding, Rajashekar clarified, “Yes, he was removed from membership, but it was not a unilateral decision by the bank. It was placed as an agenda item in the Annual General Meeting and approved by both the members and the Board of Directors in light of his actions damaging the bank’s reputation.
However, as per the Karnataka Appellate Tribunal’s directive, we have reinstated him. We respect the judiciary and have complied with the order, despite opposition from many shareholders.”
Highlighting the bank’s financial performance, the GM emphasized that TJMCC Bank has been steadily recovering. “Despite past accumulated losses, the bank has been generating profits over the past few years. In FY 2024–25, we’ve posted a gross profit of Rs 25.78 crore and expect a net profit of Rs 15.46 crore. Last year, we successfully wiped out all accumulated losses and declared an 8.5 percent dividend. This year, we aim to declare a 10 percent dividend,” he said.
Tumkur Grain Merchants Cooperative Bank has a business mix of over Rs 2,400 crore and a net worth of around Rs 209 crore. As per unaudited figures, the bank’s deposits and advances stood at Rs 1,414 crore and Rs 995 crore respectively, with a CRAR of 23.92%.
Ironically, the bank has witnessed a consistent decline in its total business — contracting from Rs 3,752 crore in FY 2019–20 to around Rs 2,400 crore in FY 2024–25. The downward trend persisted year after year: Rs 3,698 crore in FY 2020–21, Rs 3,619 crore in FY 2021–22, Rs 2,866 crore in FY 2022–23, and Rs 2,489 crore in FY 2023–24.
