Maharashtra govt’s effort to revive loss making DCCBs in the state seems to have suffered a setback as Maharashtra State Co-operative Bank (MSCB) has refused to accept the state government’s proposal to take over Wardha District Central Co-operative Bank (DCCB) in Vidarbha reports Mint.
A source close to MSC Bank says acquiring Wardha DCCB a bank having 98 percent NPA would seriously affect the apex bank’s profitability. MSC Bank is an apex body for 31 DCCBs and with a third tier of 21,085 Primary Agriculture Credit Societies (PACS).
The MSC bank’s refusal to merge Wardha DCCB puts the revival plan of 10 other loss-making DCCBs in jeopardy as well. Among these 11, Wardha, Nagpur, and Buldhana DCCBs together have a debt burden of Rs 550 crore and 1,100 employees.
The Wardha, Nagpur, and Buldhana DCCBs are among 23 unlicensed DCCBs in four states that the Narendra Modi government at the Centre chose to revive under a special capital infusion plan in November 2014. Under the plan, total capital infusion of Rs2,375 crore was approved.