MSC Bank becomes only Co-op Bank eligible for Government Banking

The Maharashtra State Cooperative Bank (MSC Bank) has emerged as the only cooperative bank in Maharashtra eligible to undertake banking transactions of government offices and investment of surplus funds of public sector undertakings and corporations for FY 2026-27.

The decision was announced through a Government Resolution issued by the Maharashtra Finance Department on August 20, 2026, which lays down financial and regulatory criteria for banks handling government banking transactions and surplus-fund investments.

For MSC Bank, the prescribed conditions include a minimum net worth of Rs 4,000 crore, five consecutive years of net profit with an ‘A’ audit rating, a Capital Adequacy Ratio (CRAR) above 12 per cent, and no financial restrictions or Prompt Corrective Action (PCA) imposed by the Reserve Bank of India. According to its FY2025-26 balance sheet, the bank has a net worth of Rs 5,746.61 crore, well above the stipulated threshold.

MSC Bank Administrative Board Chairman Vidyadhar Anaskar said the Government’s decision reflects the bank’s financial strength, sound governance and consistent performance.

He said MSC Bank’s inclusion alongside leading private and systemically important banks demonstrates growing confidence in the state’s apex cooperative bank and will strengthen its role in government banking operations.

The Government’s approved list includes leading private scheduled commercial banks such as Axis Bank, Kotak Mahindra Bank, IndusInd Bank, YES Bank, IDFC First Bank, Federal Bank, Bandhan Bank, AU Small Finance Bank and RBL Bank. HDFC Bank and ICICI Bank have been included as RBI-designated Domestic Systemically Important Banks (D-SIBs). MSC Bank is the only cooperative bank on the list.

The bank’s financial indicators further support its eligibility. As of March 31, 2026, MSC Bank reported a CRAR of 18.50 per cent, gross NPA of 8.44 per cent, net NPA of 1.64 per cent, Return on Assets of 1.45 per cent and Provision Coverage Ratio of 81.91 per cent. Its cost of management stood at 0.40 per cent, while turnover per employee was around Rs 68 crore.

The Government Resolution requires eligible banks to continue meeting the prescribed conditions and regularly furnish details of balances and investments maintained in accounts of government offices, corporations, autonomous bodies and other authorities.

MSC Bank’s inclusion marks a significant recognition for Maharashtra’s cooperative banking sector, giving the state’s apex cooperative bank a wider role in government-related banking operations and surplus-fund investments while reflecting the Government’s confidence in its financial strength and institutional capabilities.