NBP calls for reopening Omni Group's sugar mills
Says non-crushing will destroy sugarcane farmers of area
Anwar Majeed. PHOTO: EXPRESS
ISLAMABAD:
The National Bank of Pakistan (NBP) has approached the Supreme Court, seeking reopening of the eight sugar mills of the Omni Group ahead of the sugarcane crushing season so that the bank may recovery its markup on the loans previously offered to the business conglomerate.
The Federal Investigation Agency (FIA) seized control of the mills after it launched a probe into the Omni Group shareholders alleged role in Rs35 billion money laundering case.
Omni Group shareholders Anvar Majeed and his son are in the FIA custody, being the main accused in the case. Pakistan Peoples Party Co-chairman Asif Ali Zardari and his sister are also being probed in this connection by an FIA joint investigation team (JIT) formed by the Supreme Court.
FIA raids Anwar Majeed’s office in Karachi
The apex court will resume hearing of suo motu case on Monday, when the JIT will submit its report.
In a petition filed through its counsel Naeem Bokhari, the NBP said the group became its client in 2013 by opening the accounts and availing various financing facilities. The relationship continues to date.
It said the NBP has earned approximately Rs7 billion since 2013 as a markup from the Omni Group with not a single default or write off. “Markup was paid regularly till March 2018 after which the accounts of Omni Group were debt blocked by the FIA on July 31,” it said.
The bank said the crushing season will start in November and non-crushing will destroy the sugarcane farmers. “The NBP and other banks will not be able to recover advances made except by selling of plants machinery, building and land (of the mills),” it added.
Omni Group says it has impeccable record with NBP
It pleaded that a committee be constituted to operate the sugar mills to ensure that defaults do not occur either for the farmers or the banks including the NBP. It expressed fear that the national economy has already slowed down and non-crushing in eight sugar mills will aggravate the situation.
The bank also provided complete details of the amount outstanding against the eight sugar mills. It said in the accounts of the Omni Group, there were regular withdrawals and deposits in the normal course of business. The withdrawals related to general working capital requirements of the companies.
The application said the FIA’s July 31 letter was received by NBP compliance group on August 3 which was a Friday. The directive of the FIA was handed over to NBP official Afzal Sadiq for the implementation and dissemination of the FIA letter to relevant branches where accounts were maintained.
It said Sadiq had cardiac issue and on account of his illness he forgot to implement the instruction for dissemination of the FIA letter. This duty was recalled by Sadiq on August 9 and emails were sent to relevant branches.
Omni Group complains over SBP’s ‘treatment’, central bank denies allegation
Between August 4 and 10 total withdrawal of outflow was Rs188.837 million while inflow Rs307. 258 million, which is more than outflow by Rs118.421 million. However, due to noncompliance of the FIA directive, Sadiq was suspended and inquiry was initiated.
“The lapse was totally inadvertent and on account of sickness of the officer. However, no loss has occurred to the NBP. As a national government owned institution, the NBP has felt compelled to bring these essential facts to the court’s notice,” it added.
The National Bank of Pakistan (NBP) has approached the Supreme Court, seeking reopening of the eight sugar mills of the Omni Group ahead of the sugarcane crushing season so that the bank may recovery its markup on the loans previously offered to the business conglomerate.
The Federal Investigation Agency (FIA) seized control of the mills after it launched a probe into the Omni Group shareholders alleged role in Rs35 billion money laundering case.
Omni Group shareholders Anvar Majeed and his son are in the FIA custody, being the main accused in the case. Pakistan Peoples Party Co-chairman Asif Ali Zardari and his sister are also being probed in this connection by an FIA joint investigation team (JIT) formed by the Supreme Court.
FIA raids Anwar Majeed’s office in Karachi
The apex court will resume hearing of suo motu case on Monday, when the JIT will submit its report.
In a petition filed through its counsel Naeem Bokhari, the NBP said the group became its client in 2013 by opening the accounts and availing various financing facilities. The relationship continues to date.
It said the NBP has earned approximately Rs7 billion since 2013 as a markup from the Omni Group with not a single default or write off. “Markup was paid regularly till March 2018 after which the accounts of Omni Group were debt blocked by the FIA on July 31,” it said.
The bank said the crushing season will start in November and non-crushing will destroy the sugarcane farmers. “The NBP and other banks will not be able to recover advances made except by selling of plants machinery, building and land (of the mills),” it added.
Omni Group says it has impeccable record with NBP
It pleaded that a committee be constituted to operate the sugar mills to ensure that defaults do not occur either for the farmers or the banks including the NBP. It expressed fear that the national economy has already slowed down and non-crushing in eight sugar mills will aggravate the situation.
The bank also provided complete details of the amount outstanding against the eight sugar mills. It said in the accounts of the Omni Group, there were regular withdrawals and deposits in the normal course of business. The withdrawals related to general working capital requirements of the companies.
The application said the FIA’s July 31 letter was received by NBP compliance group on August 3 which was a Friday. The directive of the FIA was handed over to NBP official Afzal Sadiq for the implementation and dissemination of the FIA letter to relevant branches where accounts were maintained.
It said Sadiq had cardiac issue and on account of his illness he forgot to implement the instruction for dissemination of the FIA letter. This duty was recalled by Sadiq on August 9 and emails were sent to relevant branches.
Omni Group complains over SBP’s ‘treatment’, central bank denies allegation
Between August 4 and 10 total withdrawal of outflow was Rs188.837 million while inflow Rs307. 258 million, which is more than outflow by Rs118.421 million. However, due to noncompliance of the FIA directive, Sadiq was suspended and inquiry was initiated.
“The lapse was totally inadvertent and on account of sickness of the officer. However, no loss has occurred to the NBP. As a national government owned institution, the NBP has felt compelled to bring these essential facts to the court’s notice,” it added.