Resolution of Punjab and Maharashtra Co-operative Bank at an advanced stage: RBI– nixatube
Resolution of Punjab and Maharashtra Co-operative Bank at an advanced stage: RBI
In June, the central bank had given in-principle approval to a consortium set up by Centrum Financial Services and BharatPe to acquire the troubled co-operative bank.
Reserve Bank of India (RBI) Deputy Governor M Rajeshwar Rao on Friday said that the resolution process for Punjab and Maharashtra Co-operative (PMC) Bank is at an advanced stage. In June, the central bank had given in-principle approval to a consortium set up by Centrum Financial Services and BharatPe to acquire the troubled co-operative bank.
“Centrum and its partner BharatPe have submitted their application for license and it is in an advanced stage of consideration. Once the final license is approved, we will soon go ahead with the draft plan and get necessary approvals,” Rao said, adding, “So, it is at an advanced stage.”
As per the terms of the approval, the Centrum-BharatPe consortium was to operate a small finance bank within 120 days. In June, Jaspal Bindra, executive chairman of Centrum Group, had said that the RBI would prepare and submit the relevant notification only after the bank becomes operational. Under Section 45 of the Banking Regulation Act, the regulator can propose merger of only one bank with another and not with a non-bank entity.
Once the draft plan for amalgamation or reorganization is ready, it is expected to be placed in the public domain for comments. After that it will be informed through gazette.
In September 2019, the RBI superseded PMC Bank’s board of directors, placed it under an administrator and banned withdrawals from the bank amid mounting defaults and allegations of financial misconduct. In response to the call for bids for the takeover of the bank in November 2020, PMC Bank had received binding offers from certain investors. Finally, the Centrum-BharatPe consortium got the regulatory nod in June this year.
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