RBI forms panel to decide on merger | india | Hindustan Times
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RBI forms panel to decide on merger

india Updated: Jan 24, 2007 23:54 IST

RESERVE BANK of India (RBI) has constituted a high-power committee to decide whether approval could be granted for merger of liquidated Maharashtra Brahman Sahkari Bank Limited, Indore, with Nagpur Nagarik Sahkari Bank Limited (NNSBL), a multi-state scheduled co-operative bank.

The RSS-dominated NNSBL sent a proposal to RBI last year for taking over Maharashtra Brahmin Sahakari Bank and Hindu Nagarik Sahkari Bank Limited, Indore.

RBI till date has no policy on merger of a liquidated co-cooperative bank with a running bank and if this amalgamation takes place, it will be perhaps country’s first such fusion.

In fact, Reserve Bank had to form the committee because of Maharashtra Brahmin Sahakari Bank proposal.

This high power committee will frame a policy on merger of liquidated banks with a running bank, District Registrar, Co-Operatives and Maharashtra Brahmin Sahakari Bank liquidator, Ambrish Vaidya said.

State Co-Operatives Registrar Prabhat Parashar has already sent a no objection certificate to Reserve bank for Maharashtra Brahmin Sahakari Bank’s proposed union although an appeal for restoration of its banking license to facilitate merger is pending with appellate tribunal at Ministry of Finance, New Delhi.

The Nagpur-based NNSBL has shown interest in City’s two co-operative banks to mark its entry in Madhya Pradesh, particularly from Indore, which is the State’s commercial capital.

According to Vaidya, the merger of Hindu Bank is likely to be earlier, as its banking license is still intact although RBI has imposed a ban on withdrawals keeping in view its liquidity crisis.

As per Reserve Bank directives, the depositors cannot withdraw more than Rs 1000 from their account.