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The governor also said RBI would review its decision to revoke the suspension on PwC and will also look at issues like Satyam inflating the number of its staff, opening of so many bank accounts and application of KYC norms (Know Your Customer).
Responding to queries on the Satyam episode, Subbarao said the central bank would not reveal precise exposure for any individual company. But the exposure to Satyam and its group companies like Maytas was low. Satyam had very low leverage, he said.
Deputy Governor Usha Thorat said a part of the exposure was secured, while some was not secured. But unsecured exposure is not such a great systemic concern, she said.
The governor informed that the central bank was looking at issues like inflated number of Satyam employees and the opening of so many bank accounts and application of KYC norms (Know Your Customer).
Referring to PriceWaterhouse, the auditors for Satyam, he said, the Reserve Bank had suspended PwC from doing any audit work of banks from 2003 after the Global Trust Bank episode.
In 2007, PwC had appealed saying they had suffered for four years and requested that the suspension be revoked.
Besides, some banks asked for PwC to be appointed as auditors and the central bank agreed.
However, now due to investigations about the firm's role in the Satyam issue, the decision would be reviewed, he said.
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I wonder why RBI says like -no major irregularity in lending to Satyam- etc. Investigations are on and at this stage, none should issue communications like this. Until the full investigations by all the agencies are over, how can one comment that no major irregularity etc. All the agencies involved should refrain from issuing statements like this in the interest of fair justice to all those affected and to book the culprits who committed the biggest corporate fraud in India.