Page 19 - Banking Finance April 2019

CO-OPERATIVE BANK NEWS

CO-OPERATIVE BANK

NEWS
NEWS
NEWS
NEWS
NEWS

Bhopal: Farm loan waiver poses threat to co-op banks, MSC Bank asked to make
societies blueprint of City Co-op

The farm loan waiver scheme, launched by the state government, has put the
existence of cooperative sector banks and societies Bank's merger
in danger. The government may have started to Maharashtra Chief Minister has
waive loan through societies but it has not made any asked the Maharashtra State Coop-
payment to any of them. The formula of payment to erative
cooperative banks and societies has not yet prepared (MSC)
which is leading to resentment. Bank to
submit a
The cooperative societies are threatening for agitation. Sahakari Samiti
Karmachari Mahasangh has begun pen-down-strike. The leaders of the societ- report on
ies maintain that if the government does not prepare proper formula for pay- merger of
ment of loan waiver then they would also launch strike. the City
Coopera-
Out of the farmers, identified for farm loan waiver at the initial level, 90 per tive Bank with the apex bank.
cent of them belong to cooperative banks and societies. The agriculture depart-
In a parallel development,
ment has so far earmarked 22 lakh accounts, out of claims of around 15 lakh
accounts have been settled and sent to the collectors. There are 20 coopera- Maharashtra based PMC Bank is also
tive banks in the state which are already defaulter. The bank officials of remain- said to have submitted a merger pro-
ing banks fear that loan waiver may also put banks in this category. The finance posal of the beleaguered City Coop-
department is saying that it would pay 50 per cent on NPA to the commercial erative Bank to the RBI.
banks and cooperative banks. It also bears recall that last year RBI
imposed several restrictions on the
Repco Bank business crosses Rs.15,000 crore bank including limiting withdrawal by
depositors. Earlier, in December
Repco Bank, has announced that its business has crossed Rs.15,000 crore in FY19, Reserve Bank of India (RBI) had re-
with total deposits of Rs.8,669 crore and advances laxed restrictions placed on the City
of Rs.6,337 crore. Established in 1969 with the prime
Co-operative Bank, by allowing the
objective of rehabilitating repatriates from Sri Lanka,
depositors to withdraw Rs 5,000, the
Burma and Vietnam, the bank has a unique reputation of catering to the repa-
banking regulator said in a
triate community. With presence in 108 centres and 10-lakh customers, this statement. The bank has Rs 550
cooperative sector bank has a strong financial net worth of around Rs.800 crore.
crore in the books and around
In the past five years, it has recorded profit after tax of Rs.100-crore-plus. For 91,000 depositors.
FY2018-19, it expects to post a profit of more than Rs.110 crore.

BANKING FINANCE | APRIL | 2019 | 19