A year later, PMC bank depositors are still struggling

A year later, PMC bank depositors are still struggling

Mumbai: For tainted Punjab and Maharashtra Co-operative (PMC) bank depositors, this situation is not much different from the situation almost a year ago when the Reserve Bank of India (RBI) imposed a withdrawal ban on the bank after the mega bank senior bank. Incorrect information about the loan was revealed with the involvement of officials.
Exactly a year ago, on September 23, 2019, the RBI set aside the board of the multi-state urban cooperative bank and placed it under various regulatory restrictions after finding out some financial irregularities.
Initially, RBI allowed depositors to withdraw Rs 1,000, which was later increased to Rs 1 lakh per account to ease their difficulties. In June this year, the RBI extended the regulatory restrictions on the co-operative bank for another six months till December 22, 2020.
The depositors of PMC Bank have spent the last one year in protests, meeting politicians, writing to various officials in an effort to get back their hard-earned money. Many senior citizens are depositors, whose lives are stuck in a life-saving fraud-stricken bank.
S Borkar, one of the bank’s depositors, said, “We have organized a lot of fronts (protests), met RBI officials, politicians, but nothing has happened. We are really disappointed.”
According to Anita Lohia, a member of the PMC Bank Depositors Association, RBI has allowed depositors to withdraw Rs 1 lakh in the last one year which is a small amount for anyone.
“The day PMC Bank was banned, we thought that the situation would return to normal in a few days or months. It’s been a year but nothing has happened. With only Rs 1 lakh, it is really up to us to maintain it I have difficulty. Lohia said, “Life in a city like Mumbai for a full year.”
According to him, about 70 PMC bank depositors have lost their lives in the last one year.
He said the depositors had planned to organize a protest in front of the RBI headquarters in Fort area on Wednesday, but did not get permission from the police.
However, he expects some passage of amendments to the Banking Regulation Act to bring cooperative banks under the supervision of RBI.
Lohia said, “We expect some resolution soon with the passage (amendment) of this bill.”
The bank has a strong presence in Maharashtra in 103 of the 137 branches located in the state. Out of 103 branches, around 81 are in Mumbai and surrounding areas such as Thane, Navi Mumbai and Palghar district.
On Tuesday, RBI appointed a new administrator at PMC Bank after the current administrator JB Bhoria stepped down due to health reasons. AK Dixit, former general manager of Union Bank of India, has been appointed as the new administrator of the bank.
When contacted, Dixit said that the focus would be on finding a solution to revive the cooperative bank so that the interests of the depositors are protected.
“My sole purpose is to revive the bank and save the interest of depositors, whose money is stuck there,” Dixit told PTI.
The team at the bank is working to find a viable and sustainable solution so that depositors have access to all their money, he said.
The RBI said on Tuesday that the huge loss and erosion of deposits in PMC Bank has been a hindrance in its revival.
“The administrators of PMC Bank and RBI are exploring various options to resolve the bank, while many losses incurred by the bank such as its entire net worth are wiped out, deposits fall, etc. continue to fall. The RBI on Tuesday faced serious challenges in formulating a workable plan for the bank’s revival.
The bank said that the bank is also striving for recovery of NPAs, although progress has been hampered due to the Kovid-19 epidemic and legal complications.
RBI further stated that in the interest of depositors, PMC Bank and RBI engage with stakeholders to explore the possibility of finding a viable and viable solution for the bank’s resolution.
PMC Bank hid and misrepresented loans given to real estate developer HDIL. Its exposure to the HDIL group was more than Rs 6,500 crore, which was nearly 73 percent of the total loan book size of Rs 8,880 crore as of September 19, 2019. As on 31 March 2019, its deposit base was Rs 11,617.34 crore.
One of its board members was leaked to the RBI, forcing the bank’s former managing director Joy Thomas to confess to the regulator about lending the bank the wrong way.
Thomas was arrested in October last year along with former bank chairman Variyam Singh. The Economic Offenses Wing (EOW) of Mumbai Police later arrested some more officers of the bank in a fraud case.

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