Researcher-conducive Environment: My Unfloding Voyage 077

In the academic research environment, there maybe more serious interactions among research colleagues- both in their offices / seminar rooms  and in the cafetaria. In the Indian Statistical Institute I was therefore a disturbing element, debating issues other than the areas of reserch and leg-pulling gossips. In the area of in-house business research and planning, work went hand-in-hand with gossips and leg-pulling across the work desks and cabins. MaloyBabu would not spare Dr. Chatterjee's claim that his Kasba residence would fall under the Calcutta district once the fly-over connecting Gariahat to the areas to the east across the Railawy line gets over. Those days smoking was freely allowed inside the office and storms over the tea cups was regular part of daily research routine. Mrinal Vaishya would always have a smiling face even if leg-puuling attacks were turned towards him and occasionally make an interesting observation to fuel a laughter among others. He has always been a nice guy. Once both of us went to Gauhati on an official program to conduct training. Being a local person he took me to his paternal residence, got an invitation for me to attend a wedding party at his relative's residence and took me on a tour to various places like Panbazar, Fancybazar, etc. Thirty-years' later he would be at the Bank's headquarters at Kolkata as Chief General Manager and would with great affection help my wife to get the best of services at the Bank's Old Court House Street Branch. He would also introduce her to his colleague Mohanty who continues tio provide her with help in conducting her mother's pension-related banking transactions.

Dr. SC Chatterjee had got his doctorate, probably in Urban Economics, from Warsaw, Poland and before joining the Bank was working for the Calcutta Metropolita Development Authority. He used to narrate to us about his special adventures in Poland. Pratul Mukherjee, a Statistician, also shifted to the Bank for the same organisation that Dr. Chatterjee had served: he was another person who was always smiling and was very affectionate to colleagues. Once he had invited some of us to his residence for an evening party. After three decades I had the opportunity to meet Pratul Babu again at a private music party. As a retired person, he would be enjoying his freedom as a singer - with fame that would help us see him in TV shows.

Maloy Gupta, senior to me in the university by a few years, had been teaching in a college before he joined the Bank, six months later than me. His special 'u' and 'ee' touches to commn Bengali words like 'bheeshon', 'ekhon' still rings in my ears. He specialised in determining the origin of a Bengali by observing the words used in conversation: between 'Manriye' and 'Pariye', he identified my origin in East Bengal (now Bangladesh). As a Ghati, he supported Mohan Soccer team, and my support to East Bengal Soccer Club was linked to my being of Bangal origin. MaloBabu was very particular about treating women as flowers and was highly romantic picking up a flower from the college where he taught economics. Thirty eight years later, I would receive a phone call from him: he had retired from the Bank by then and was the Director of a management school. He had picked up his doctorate degree while he was still working in the Bank.

Every year, before candidates were interviewed for recruitment, boss would tell us this time he would ensure that real good economists and statisticians were selected. What he probably meant was that he would be able to find freshers who would be more quick in adapting to his high standards of drafting office research notes and other written communication than those the Bank had hired in previous years. Every year he failed in his mission. Those who were recruited earlier would feel offended for being categorised as inferior stuff and murmur behind bosses back. Some of us who had experienced this for long would console them and smile away knowing that boss would continue doing this.

I would take this chance to get some brilliant economists to the Bank. I had to pursue a lot with Dipankar Coondoo and Pradeep Maity, seniors at the University and reserach scholars at that time at the Indian Statistical Instiute. Both of them applied for the Bank's job and got selected. Dipankar-da joined. Pradip-da hesitated and then declined after he got a faculty position assurance at the Institute. Dipankar-da worked for a year, got bored and then returned to the Instiute as facaulty member.

A Silver Coin: My Unfloding Voyage 066

Socialist banking in India would slowly develop a new Indian economic theory and practice of banking - some kind of a mixture or khitcuhri of banking as it had developed by the British rulers and political and bureaucratic ideas of populist gimmickry and wastage. Nationalisation of 14 major Indian banks in 1969 paved the way for completion of socialistic, state monopoly banking edifice in the country. The nationalised banks became the hotbed of trade unionism that would push up banking costs, declining customer service on the one hand and politically directed lending on the other hand. The statutory liquidity ratio would soon make banks transfer one third of their deposits resources to the State and state-controlled financing agencies as banks were obligated to invest in securities issued by the Government and its approved agencies to the extent of 35% of their incremental deposits every year. In the name of controlling inflation the central bank, the Reserve Bank of India, would progressively raise the cash reserve ratio to the 10% region. Of the remaining, 55% of the banks' deposit resources, as much as 40% would be required to be deployed in what was termed as priority sector at concessional rates. Thus the banks' would have freedom to invest at their will only to the extent of Rs 33 out of every Rs 100 raised in the form of deposits. Banks would be permitted to lend some amount by borrowing from the Reserve Bank of India or other refinancing agencies of the Government. The interest rates on deposits and bank loans were fixed by the Reserve Bank of India and that ensured adequate spread to cover high labor costs in banking. There was little to apply mind for formulating an independent monetary policy for inflation control and macro-economic stabilisation in this banking regime.
The banks' continued the practice of understating income to create hidden reserves against probable loan losses and there was no way of knowing whether such secret reserves were adequate  (the prudential provisioning norms were introduced only after the reforms in the 1990s when most banks took a heavy  burden of loan loss provisioning and write-offs along with income de-recognition against impaired , non-performing assets to an extent that would erode their capital significantly). In 25 years of the Indian economic planning regime, banking had become an instrument of both economic development in accordance with politically dictated priorities as well as a conduit for hiding lost / wasted financial wealth of progressively rising amounts. It is only in the 1990s that the requirements of prudential loan provisioning and income recognition norms caused these huge, accumulated hidden losses to surface as high percentage of non-performing assets in banks.

United Bank of India (UBI) created through the merger in 1950 of four Bengali banks: Comilla Banking Corporation (founded in 1914 in what is now Bangladesh), Bengal Central Bank (founded in 1918), Comilla Union Bank (founded in 1922) and Hooghly Bank (founded in 1932) also completed 25 years of its existence in 1975. As an employee, I received a silver coin commemorating the Silver Jubilee year and there was a grand celebration event at the Bank's headquarters. We were all happy to be part of a Bank that originated in Bengal and survived competition for 25 years  - merging into itself or acquiring, Cuttack Bank and Tezpur Industrial Bank in 1961, before getting nationalized with its 17 branches, along with 13 other major Indian commercial banks in July 1969 and then in 1973 acquiring Hindusthan Mercantile Bank and in1976 UBI Narang Bank of India.

Another 25 years later, the Bank would celebrate its Golden Jubilee: I would be so happy to be present at the celebration event at the same building in 2001 as the Chairman of a public sector  development bank - thanks to UBI Chairman Biswajit Chowdhury's affectionate invitation.