Nirmala speaks to RBI Governor over PMC Bank issue, reassures depositors

Finance Minister Nirmala Sitharaman on Saturday (October 12) assured the Punjab and Maharashtra Co-operative (PMC) Bank customers that the government will ensure their concerns are addressed on a priority-basis.

The Reserve Bank of India (RBI) had last month capped withdrawals from the PMC Bank at ₹25,000 due to its weak financial wealth.

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Taking to microblogging website Twitter, the finance minister on Saturday said, “Spoken to governor @RBI on the #PMCBank matter. He assured me that clients & their concerns will be kept on top priority. I wish to reiterate that @FinMinIndia will ensure that customers concerns are comprehensively addressed. We understand the justified worries of the customers (sic).”

The PMC Bank is in bad health allegedly due to its exposure to near-bankrupt realty player HDIL, to which it has loaned over 70% of its ₹9,000 crore in advances.

The finance minister had earlier this week told the media that the ministry has nothing to do with the PMC Bank issue directly since RBI is the regulator. However, she said that she had asked the finance ministry secretaries to work with Rural Development Ministry and the Urban Development Ministry to study the issue in detail, reported PTI.

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Secretaries from the department of financial services and economic affairs will be meeting a deputy governor of the RBI soon to look into the “shortcomings” of the functioning of multi-state cooperative banks and see if any amendments can be made to the laws, she had said.

“They will discuss legislative steps needed to prevent such incidents from happening and empower the regulator better,” she was quoted as saying. The government will bring in a legislation to this effect in the winter session of Parliament, she had said.

(With inputs from agencies)