The Reserve Bank of India on Thursday once again increased the withdrawal limit for customers of Mumbai-based Punjab and Maharashtra Cooperative Bank from Rs 10,000 to Rs 25,000.
“The Reserve Bank of India again reviewed the bank’s liquidity position and, with a view to reducing the hardship of the depositors, has decided to further enhance the limit for withdrawal to Rs 25,000,” the central bank said in a press release.
The RBI said the new relaxation will allow 70% of the customers of PMC bank to withdraw their entire account balance. “The Reserve Bank is monitoring the position of the bank and will continue to take necessary steps in the interest of depositors,” it added.
The central bank also said that it has decided to appoint a three-member committee to assist the administrator appointed by them. The administrator was appointed last week to oversee the cooperative bank’s operations while it is under investigation.
On September 24, the RBI imposed restrictions and said depositors would not be allowed to withdraw more than Rs 1,000 from the bank for six months. The central bank also said PMC Bank would not be allowed to grant or renew any loans and advances, make any investment, or incur any liability including borrowal of funds. It later increased the withdrawal limit for bank customers to Rs 10,000.
Earlier on Thursday, the Economic Offences Wing of the Mumbai Police arrested two top officials of the real estate company Housing Development and Infrastructure Limited, or HDIL, for alleged irregularities. One of those arrested, Rakesh Wadhawan, is the executive chairperson of the company and the other, Sarang Wadhawan, is the managing director. They were named in a first information report filed on Monday. Officials of the Punjab and Maharashtra Cooperative Bank were also named in the FIR for loan default reportedly up to Rs 4,300 crore.
The Mumbai Police had said special investigation team has been formed to conduct inquiries into the case. According to the complaint in the case, the accused officials deliberately misled the Reserve Bank of India for more than a decade, from 2008 to August 2019, by not disclosing big accounts that had become non-performing assets. They allegedly produced forged audit reports.
Following the RBI’s decision to impose restrictions, account holders had protested outside bank’s main branch in Mumbai’s Bhandup area and various other branches. Many had also lined up outside bank branches after the announcement.
The bank, founded in 1984, operates in Maharashtra, Delhi, Karnataka, Goa, Gujarat, Andhra Pradesh and Madhya Pradesh. It has 137 branches in six states, and is among the top 10 cooperative banks in the country.
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