MAPUSA: Coming under severe financial stress, the board of directors of the Mapusa Urban Cooperative Bank of Goa (MUCB) has admitted its inability to run the financial institution and has asked the government to take over management of the bank.
The BoDs have also said the financial position of the coop bank was in precarious condition and urged the government to appoint a committee of administrators to run the affairs of the bank and to help it regain its financial health.
“Day by day, the financial health of the bank is deteriorating. Since the bank is under RBI directions and our request for relaxations is pending, we are unable to run the bank anymore,” said Gurudas Natekar, chairman of the bank in a letter to the chief minister on June 18.
The chairman in his letter also said the BoDs were ready to resign and hand over reins of the bank to the government.
“I assure you that all members of the board will submit resignations as directors of the bank at any time and handover the bank to government of Goa,” Natekar told the CM in the letter.
MUCB Chairman Gurudas Natekar told The Goan that he has given a proposal to the government to take over the bank.
“Time to time, we have written to the government requesting it to take over the bank to tide over its financial crisis. We are now awaiting an audience with the chief minister,” Natekar said.
He said the RBI curbs and inability to get an early decision in HC in the matter have led the BoDs to take the ultimate decision.
The chairman also informed that in an effort to retrieve the bank from its current situation it had approached various banks for merger.
“Dombivli Nagari Sahakari Bank Ltd, Mumbai had shown interest and appointed an auditor to complete due diligence of our bank. The Dombivli bank also said that they would consider on the merger issue subject to approval from RBI and Central Registrar,” he wrote.
The chairman said is such a situation, the only way out was either for government taking over of the bank or merge it with another bank.
“The management is of the opinion that infusion of share capital from government or amalgamation/merger are the only option to safe guard the interest of the shareholders, depositors, staff and also to come out of RBI directions,” he said and sought immediate action from the government to come out from the present situation.
In last year’s annual general body meeting of the bank, allegations flew thick and fast over the bank’s merger and conversion of its status to credit society. Some of the shareholders had also demanded resignation of the BoDs to shore up the bank’s prospects.
