MARGAO
Will the bank go for liquidation a la the Mapusa Urban Cooperative Bank? Or, will the Reserve Bank of India (RBI) find a banking institution for the merger of the Cooperative bank? Or, still will the RBI further extend the restrictions imposed on the bank, including restrictions on depositors to withdraw their hard earned money?
These and other questions have come to the fore on the very future of the Madgaum Urban Cooperative Bank as just around 12 days to go for the expiry of the RBI order, imposing restrictions on the MUCB on June 2.
Before the RBI further extended the restrictions on the MUCB till June 2, the apex banking institution had issued a notice on the Cooperative bank on late February to show cause within one month why the license issued to the bank should not be withdrawn and the bank liquidated.
The MUCB Board of Directors, which discussed the RBI notice threadbare, filed a reply requesting the Apex Bank to set in motion the process to merge the MUCB bank with any other stable bank, indication that the Board was neither in favour of the RBI withdrawing the license granted to the Bank nor liquidation.
MUCB managing Director Kishore Amonkar contended that the RBI has been armed with powers by an Act of Parliament to explore the possibilities of merger of banks, adding “the MUCB Board has requested the RBI to invoke the powers under the new law and merge MUCH with another bank”.
Amonkar told The Goan that the MUCB has not received any further communique from the RBI since the Bank had filed its reply, calling upon the Apex bank to merge the Cooperative bank with some other bank.
The MUCB also has no clue whether the RBI will extend the restrictions on the bank by a further period of three months from June 2. “We are clueless. The Board had filed a reply to the show cause notice, but there’s no further communique from the RBI till date. We have done the follow up with the Apex bank, there’s no reply till date”, Amonkar stated.
The Public Interest Litigation filed by a group of beleaguered depositors led by Dinisio Sardinha is also pending before the High Court. At the last date of hearing, the RBI counsel had sought time to file a reply on the petition filed by the depositors and the proposal made by the Bank for payment of additional money to the depositors. “The matter has not come up for hearing since the second wave of COVID pandemic hit the state and only urgent matters are being taken up by the Court now”, sources said.
With the RBI yet to communicate on the question of withdrawal of the license and the liquidation of the MUCB, the Board and the depositors are indeed keeping their fingers crossed over the fate that awaits the Margao-based Cooperative bank.
