In a recently concluded AGM of NAFCUB participants sought pride from the fact that India has about 85 women cooperative banks and all are doing well.
It is also true that compared to male dominated UCBs, Women co-op banks gave little chance to regulators in the past. But here is a piece of bad news.
Effective close of business on August 20, 2014, the Reserve Bank of India has issued certain Directions to Shatabdi Mahila Sahakari Bank based in Thane. The bank has also been restrained from granting or renewing any loans and advances, making any investment, incurring any liability including borrowal of funds and acceptance of fresh deposits.
The regulator also prevents it from disbursing or agreeing to disburse any payment whether in discharge of its liabilities and obligations or otherwise, enter into any compromise or arrangement and selling, transferring or otherwise disposing of any of its properties or assets except as notified in the RBI Directions dated August 14, 2014 a copy of which is displayed on the bank’s premises for perusal by interested members of the public.
It can do so only with prior approval in writing from the Reserve Bank of India. Under the directions, depositors will be allowed to withdraw only Rupees one thousand of the total balance in every savings bank or current account or any other deposit account.
The Reserve Bank has also clarified that its directions should not per se be construed as cancellation of its banking licence as the bank will continue to undertake banking business with restrictions till its financial position improves. The Reserve Bank may consider modifications of these Directions depending upon circumstances.
