Merger delay irks PMC depositors

Banking Blues

- Scam-hit PMC Bank under close of business since September 23, 2019

- RBI extended validity of direction till December 31

- The directive not gone down well for 9 lakh odd depositors

- Invited suggestions on amalgamation of PMC with Unity Small Finance Bank

- Forum said depositors already lost Rs810 cr in 27 months

Mumbai: The Reserve Bank of India (RBI) has extended its validity period of directions to the scam-hit Punjab and Maharashtra Cooperative (PMC) Bank. PMC is a Mumbai-based multi-state urban cooperative bank, which was placed under all-inclusive directions with effect from close of business on September 23, 2019, in the interest of depositors.

The directions were last extended vide directive dated June 25 up to December 31. In exercise of the powers conferred on it by the Banking Regulation Act, 1949, RBI had prepared a draft scheme of amalgamation of The Punjab and Maharashtra Cooperative (PMC) Bank with Unity Small Finance Bank (USFB).

The draft scheme was placed in public domain on November 22 inviting suggestions and objections, till December 10, from members, depositors and other creditors of transferor bank (PMC) and transferee bank (USFB). Further action with regard to sanction of the scheme is under process.

"It is, therefore, considered necessary to extend the aforesaid directions. Accordingly, it is hereby notified for the information of the public that the validity of the aforesaid directive dated

September 23, 2019, as modified from time to time, has been extended for a further period from January 1 to March 31, subject to review. All other terms and conditions of the directives under reference shall remain unchanged," the RBI said in a statement.

However, RBI's directive has not gone down well with 9 lakh odd depositors of the bank.

Talking to Bizz Buzz, the president of PMC Depositors' Forum president, Chander Purswani said, "I am shocked to see one more extension of moratorium period of another three months by RBI. They have lost the humanity in this country, can any one of them survive in Rs111 per day what the amount they have given to the depositors in 27 months. (Rs1 Lakh divided by 27 months and further divided by 30 days)."

As per their amalgamation scheme they had asked our objections & suggestions with the timeline of 18 days which got over on December 10, 2021, but RBI cannot work in the 20 days & give us the final draft of the amalgamation scheme. On the humanitarian ground they should have worked faster rather than giving extensions after extensions and losing Rs30 crores a month which is the expense of our bank which is finally the depositors money. In 27 months we already have lost Rs810 crore and and another three months mean another Rs90 crore loss, he pointed out.

Neither the State government, nor the central government nor RBI is bothered of the depositors whether they live or die. They need to remember that there are nine lakh depositors & nearing BMC elections in the month of March. The political fight between State & Centre has made the depositors suffer more & more, Purswani.

According to him, "We depositors are not concerned about the political rivalry as we just need our tax paid money to be refunded immediately. Today, which investor from abroad would invest in India when our financial institutions like RBI, the autonomous body and pillar of the banking sector, is in doldrums. It is clear that they have not been able to manage the banks like Yes Bank, Laxmi Vilas Bank, RBL, Saraswat Cooperative and PNB. The corporate loot the common man and declare NPA and run away from the country. If they are unable to manage the cooperative banks, why can't they shut them instead of encouraging them to loot more and more common man."