Mumbai cooperative bank’s existence hangs by a thread as loans worth crores of rupees it has extended to cooperative sugar mills controlled by politicians of all tints including Congress, BJP, and NCP are not being repaid. Significantly, one of the mills defaulting on loans is headed by former President Pratibha Patil.
Pravin Darekar chairman of the affected bank has called for high level intervention in the matter. It is incumbent on the state govt to ensure repayment of loans as it acts as a bank guarantor against loans given to cooperative bodies, Darekar reasoned.
A source close to the bank requesting anonymity said the sugar mills would never repay the astronomically high amount they owed the bank unless their political heads were threatened with immediate incarceration. The total amount involved was more than hundred crore and about a score of banks had not made the repayment, it added.
Some independent sources said they had watched with incomprehension how the defaulting sugar mills had stubbornly refused to pay even when they had been repeatedly approached to return the money. The bank was on the cusp of unraveling and therefore some urgent action was needed to avert the crisis, they suggested.