RBI said that it is considered necessary to extend the instructions, keeping in view the time required to complete the various activities involved in the process.
PMC Bank
The Reserve Bank of India (RBI) on Friday extended the restrictions on Punjab and Maharashtra Co-operative Bank (PMC Bank) from July 1, 2021 to December 31, 2021. RBI said that the instructions have been extended keeping in mind the time required to complete the reconstruction of PMC Bank. RBI said that after careful consideration, the proposal of Centrum Financial Services Limited (CFSL) as well as Resilient Innovation Private Limited (BharatPe) has been found prima facie to be viable.
The Reserve Bank also said, keeping in view the time required to complete the various activities involved in the process, it is considered necessary to extend the above instructions. RBI said, it is notified for the information of the public that the validity of the aforesaid directive, as amended from time to time, has been extended for a period from 1st July, 2021 to 31st December, 2021, which is subject to review. The instructions were last extended from March 26, 2021 to June 30, 2021.
Last week, the RBI cleared the decks for the acquisition of PMC Bank by a consortium of non-bank lender Centrum Financial Services and fintech startup BharatPe. It had given in-principle approval to Centrum to set up a small finance bank under on-tap licensing norms. In September 2019, RBI imposed severe restrictions on PMC Bank, including cash withdrawals, amid investigations into accounting lapses. The cash withdrawal limit was initially capped at Rs 1,000 per account for six months, but increased to Rs 1 in June last year. ,00,000 was made.
Apparently PMC Bank is working under the administration of Reserve Bank since September 2019. More than Rs 10,723 crore of depositors’ money is still stuck in this bank. Similarly, a total of Rs 6,500 crore of the bank’s loans are stuck in recovery which have been declared as NPA. For the acquisition of PMC, Centrum Group has registered a joint venture company named Resilient Innovations in association with Gurugram-based BharatPe. Both have an equal share in this. Under the existing rules, the enforcement of the proposed small loan bank will be Centrum Group.
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