Central bank hikes PMC withdrawal limit to ₹10,000
MUMBAI: The Reserve Bank of India (RBI) on Thursday allowed depositors of Punjab and Maharashtra Co-operative Bank Ltd (PMC) to withdraw up to ₹10,000 from their accounts, up from ₹1,000 fixed two days earlier.
The new limit will allow 60% of the bank’s depositors to withdraw all of their money, the central bank said in a statement, in a relief for customers caught unawares by the sudden curbs on the multistate cooperative bank. RBI also said it has superseded PMC Bank’s board and appointed an administrator.
“The above relaxation has been granted with a view to reducing the hardship of depositors. The Reserve Bank of India is closely monitoring the position and shall continue to take further steps as are necessary to safeguard the interest of the depositors of the bank,” said RBI.
According to the RBI statement, the change, made in the interest of depositors, follows a preliminary assessment of the bank’s latest depositor and liquidity profile as furnished by the administrator.
“Accordingly, vide modified directive dated September 26, 2019, it has been decided to allow the depositors to withdraw a sum not exceeding ₹10,000 of the total balance held in every savings bank account or current account or any other deposit account,” it said, adding that other terms and conditions of its directive remain unchanged.
RBI said its earlier directions were necessitated by major financial irregularities, failure of internal control and systems of the bank and wrong reporting or under-reporting of its exposures under various off-site surveillance reports to RBI that came to its notice recently.
“Therefore, the board of the bank has also been superseded under sub sections (1) and (2) of Section 36 AAA read with Section 56 of the Banking Regulation Act, 1949 and an administrator has been appointed. The administrator is taking necessary steps in this regard,” it said.
RBI, which is investigating accounting lapses at PMC Bank, on Tuesday imposed curbs including a withdrawal cap, sparking panic among depositors.
The bank was also barred from making fresh loans and taking deposits.
Meanwhile, employees protested outside the residence of Housing Development and Infrastructure Ltd director Sarang Wadhawan over loans given by PMC Bank. According to a Hindustan Times report, customers of PMC Bank lodged a police complaint on Thursday, alleging malpractices by the bank’s directors.
The complaint alleged that at least 14 directors, including the bank’s chairman, are responsible for misappropriation of funds.
The police have not yet filed a first information report. “We have received a written application from account holders of PMC Bank. Further action will be taken after examining the complaint,” a police officer told HT.
THE NEW LIMIT WILL ALLOW 60% OF THE BANK’S DEPOSITORS TO WITHDRAW ALL OF THEIR MONEY