Finance likely to grant extension to Zaka Ashraf

The Finance Ministry is likely to give extension to Zaka Ashraf, President of Zarai Tarqiati Bank Limited (ZTBL), whose term expired on August 30, 2011, sources in Finance Ministry told Business Recorder. ZTBL's Board of Directors (BoD), headed by Sultan Ali Chaudhary, held a meeting recently in Lahore to endorse the name of Zaka Ashraf for extension, on a summary sent by the Ministry of Finance (MoF).
Ms Nazrat Bashir, Abdul Wajid Arain, Muhammad Iftikhat Khan Mohman, Dr Khalid Ahmad Khokhar, Khizar Hayat Khan, Dr Amir Muhammad, Zafar Iqbal, M Yaqub Vardag and Muhammad Nawaz Shah are members of the Board of Directors. "We have endorsed the summary of Finance Ministry in which the latter had recommended extension in the term of incumbent President ZTBL," said Sultan.
When the BoD Chairman was asked whether the BoD was unaware of several cases against the incumbent President (CEO) in different courts including the Supreme Court of Pakistan, he replied that none of the Directors had raised any objection to the extension, which implied that the decision was unanimous.
"We received a summary from the Finance Ministry for endorsement, and we endorsed it, like in the past," said Sultan, a close friend of the incumbent CEO. A senior official of the Ministry of Finance told this scribe that the case of Zaka Ashraf is under review, and no final decision has been taken so far.
Sources said that the Finance Ministry is investigating an unsigned ZTBL management audit report which shows massive irregularities in appointments, promotions, payments and illegal postings of Kissan Support Services Limited (KSSL), including that of the Chief Operating Officer.
According to Auditor General of Pakistan non-markup/interest expenses including administrative expenses increased to Rs 5.236 billion in 2009 from Rs 4.520 billion in 2008 showing an increase of 15.83 percent. Increase was particularly significant in salaries, allowances and services rendered by KSSL. ZTBL provided interest-free loan of Rs 15 million to its subsidiary KSSL whereas the Bank has paid interest on the deposits of its subsidiary KSSL worth Rs 32 million.
The management paid an amount of Rs 677.8 million on account of commutation to the employees during 2009. ZTBL carries out commercial banking activities in some of its branches and the annual financial statement reflects on commercial activities during 2008 and 2009.
AGP also detected irregularities and mismanagement in purchase and sale of vehicles of millions of rupees in ZTBL. According to audit report-2010-11 of AGP, the Bank procured vehicles valued at Rs 263.120 million (Rs 82.020 million in 2009 and Rs 181.100 million in 2008) during the last two years. The Bank sold vehicles costing Rs 12.034 million to Bank executives at book value of Rs 5.401 million before they had completed their useful life.
According to the report, book value of investments, held in unlisted companies, declined to Rs 10.523 million on December 31, 2009 against the face value of Rs 35.788 million. Investments were made without proper evaluation of these companies' activities.