On Saturday, The chairman of mid-sized state-run lender Syndicate Bank Ltd was arrested on Saturday by police. He has been alleged of accepting bribes to avail loan extensions to a company, said a woman police officer.

The police further revealed that the Central Bureau of Investigation (CBI) has lodged a case against Syndicate Bank Chairman Sudhir Kumar Jain and 11 others, including two directors of a Delhi-based company. The probe agency is further investigating the matter and is expected to finalize the case soon.

S K Jain, in return for increasing the credit limit, allegedly asked the company to pay a bribe of `50 lakh for which Vineet Godha acted as the middleman.

“The exchange of the bribe money took place at the residence of Vineet and Punit Godha. The said amount that was finally to be given to the Syndicate Bank CMD, reached Bhopal through the hawala route. We have also arrested Vijay Pahuja, a hawala operator, in the case,” said an official with the probe agency. The CBI has taken the arrested persons on a transit remand and will present them in the Patiala Court in New Delhi on Monday. Another accused in the case, Puroshotam Totlani, is absconding.

“Apart from Jain, Neeraj Singhal, VC of Bhushan Steel Ltd, Delhi, Ved Prakash Agarwal and Vipul Agarwal of Prakash Industries, Delhi, are also accused in the case and are likely to be arrested soon. The CBI is also looking for two other accused persons — Pawan Bansal and Pankaj Bansal,” said a CBI officer.

The CBI said it searched 20 locations in four cities and found “incriminating documents” related to the case. It also found cash, jewellery and property documents from Jain’s house, the agency said.

Rising bad loans are a concern for Indian banks. Stressed loans in India, those categorised as bad or restructured, total $100 billion, or about 10 percent of all loans.

Last year, the CBI investigated a senior executive of top lender State Bank of India for allegedly taking bribes to facilitate loans to a company.