Nafcub, Maharashtra UCB Federation, Sahakar Bharati and several other co-op related organizations held a press conference in Mumbai on Thursday opposing strongly RBI’s premise that there should be BoM in urban cooperative banks and that this would help them grow.
The leaders rejected RBI’s insinuation that the elected Board of Directors (BoD) of UCBs are less effective and lack professionalism and that their performance has been inferior. In fact, UCBs have done well even in the face of stringent curbs imposed on them by RBI, they contended.
They charged that RBI is unprepared to encourage any growth and expansion of UCBs even when UCBs extend support to the under privileged segments by Funding the Unfunded. In the country about 1562 UCBs working, out of which 502 in Maharashtra, which are having business of around Rs. 15 lac Crs, they gave details.
“The proposed BoM is like any other committee of the BoD. Therefore, calling it BoM rather than a Committee of BoD sounds like instituting another parallel layer engaged in similar functions. This will result in duplication, consequent delays and disharmony in the overall working of the UCB Sector”, they argued.
Those present in the press meet included Sahakar Bharati’s Dr. Uday Joshi, Nafcub’s Ram Babu Shandilya, Maharashtra State UCBs Federation Chairman Vidyadhar Anaskar, MSC Banks Association Chairman Sharad Maid, Director Sanjay Bhende, All India UCB’s Cell In-charge Sanjay Birla & State UCBs Cell In-charge Subhash Joshi.
All the representatives present at Press conference unanimously rejected the concept of the imposition of Board of Management (BoM) as undesirable, untimely & unnecessary.
Earlier, representatives of more than 100 Urban Co-op Banks had attended a meeting organized by the MSC Bank & Sahakar Bharati at Vashi to discuss the issue.
They also recollected that way back in 2011, the entire UCB sector had disapproved the concept of two bodies managing the affairs of Urban Cooperative Banks when the Malegam Committee recommended constitution of BoM.
“The UCB Sector still strongly retains the same views and does not endorse the concept of BOM. Seven years on, despite satisfactory and improved performance of the UCB Sector, RBI’s renewed proposal to introduce the BoM reflects adversely on the Regulator and we note with dismay and regret that the RBI has refused to recognize the positive developments in the UCB Sector”, leaders lamented.
Recently, speaking in a meeting former Agriculture Minister Sharad Pawar had also urged all cooperative banks to oppose the draft guidelines on constituting Board of Management (BoM) in addition to the Board of Directors (BoD).
