CM calls high-level meet to resolve Rupee Bank merger

Maharashtra Chief Minister Devendra Fadnavis has evinced interest in solving the issues pertaining to the Pune based Rupee Cooperative Bank by calling all the stake holders on Wednesday.

The meeting was attended by top officials of co-op department of Maharashtra, Executive Director of RBI, representatives of TJSB Bank (eager to take over) and the Board of Administrators of Rupee Bank appointed by the govt.

Fadnavis urged all to resolve the issue as lakhs of depositors of Rupee Bank are clueless about the fate of their hard-earned savings. In particular, he requested RBI representative to facilitate the merger of the ailing bank with another cooperative bank, TJSB in the present case.

In a parallel development Bombay High Court has also asked the RBI to respond to various merger proposals received by the Rupee Bank and submitted to RBI in the past. The apex bank has been wavering to take a call on the matter and seeking time again and again.

The High Court has asked RBI to come with a concrete reply by June 13-the next date of hearing. According to media reports there are three urban cooperative banks which have shown interest taking over the ailing bank and they are TJSB, Saraswat Co-op Bank and Janseva Sahakari Bank.

Financial Express quotes Sudhir Pandit, chairman, Board of Administrators of Rupee Coop Bank saying “the Thane Janata Sahakari Bank has shown interest for a merger with Rupee Cooperative Bank, however, the existing guidelines do not permit the acquisition of the assets and liabilities of the cooperative bank by a cooperative bank.”

Pandit cites the example of the merger of Suvarna Sahakari Bank with Indian Overseas Bank ( IOB) where IOB was allowed to take over the assets and liabilities of Suvarna Sahakari Bank. Pandit said RBI should take a lenient view and permit the same in the case of cooperative banks as well, according to Financial Express.

It bears recall that the Reserve Bank of India has extended directions issued to Pune based Rupee Co-operative Bank for a further period of three months from June 01, 2018 to August 31, 2018 subject to review.

The directions were originally imposed from February 22, 2013 to August 21, 2013 and were extended on eight occasions for a period of six months each and four occasions for a period of three months each.

Rupee Cooperative Bank has earned a profit of Rs 5.46 crore so far in 2018, compared to the Rs 16-crore in the last financial year. The bank has recovered Rs 42.80 crore and effected economy of its financial resources, according to media reports.

A source identified with the bank claims the bank has reduced the gap between its assets and liabilities from Rs 460 crore to Rs 440 crore.

The bank has downsized its workforce as well as cut down on the administrative cost. It has carried out strong measures to recover dues from defaulters as well as its past directors and executives by attaching their properties. The tie-up efforts with other banks have however failed to fructify so far.

Rupee bank has about 6.2 lakh depositors. The RBI has placed restrictions on the bank since 2013 owing to its poor financial health. It has losses amounting to a whopping Rs 1400 crore.

More than half of its employees have left under the voluntary retirement scheme and the bank has seen several set of administrators appointed by the government.

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Comments ( 2 )

  1. AMAR ASHOK KANTAK

    EXCELLENT . WE HOPE M/S TJSB TAKES OVER M/S RCBL BY END JULY 2018 .

  2. Nagendra Naik

    In this country there is no value for poor and retired peoples hardwork money ,even RBI also having more rascal officers,bank board persons done like this,then why not taking action,because not theirs money, this all customers curses never failed,in other countries ,mostly public’s definitely killed within a short period,whole country is corrupted.

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