Govt will revive MSC Bank, confirms Chavan | mumbai | Hindustan Times
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Govt will revive MSC Bank, confirms Chavan

mumbai Updated: May 21, 2011 01:43 IST
HT Correspondent
HT Correspondent
Hindustan Times
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The state government will revive the Maharashtra State Cooperative Bank, which was put under administrators' rule since May 7 on charges of mismanagement and irregularities, chief minister Prithviraj Chavan said on Friday.

Following the Reserve Bank of India’s (RBI’s) directives to dissolve the bank’s board of directors, the Congress and Nationalist Congress Party (NCP) have been trading charges against each other.

This tussle has hurt the NCP most because it controlled the bank’s affairs.

The NCP felt that Chavan could have avoided action against the bank because the RBI formed its recommendation on the basis of bank’s

two-year-old accounts, while the latest accounts indicated that the bank was getting better financially.

“We are seriously thinking on measures to revive the bank because it’s a prime institute. The action plan is being made and we will take all possible help [from all quarters],” Chavan said after the cabinet meeting.

The CM told the Hindustan Times that the state government would give all possible financial help in terms of counter guarantees against loans disbursed. “We offered the bank such a guarantee some time ago and we will do so again,” he said.

Chavan’s statement confirmed that after a fortnight of scuffle, the Congress has decided to bury the hatchet with NCP and bail out the bank.

The Hindustan Times was first to report this development on May 20.

Ending the issue amicably is politically correct for the Congress because it will need the NCP’s help to get its candidate elected to the Rajya Sabha. Also, the bank being an apex finance body, which provides farm loans to district

co-operative banks and credit societies, the Congress cannot afford to invite farmers’ ire ahead of the local self-government polls later this year.

Chavan strongly defended the defaulters from the Congress and NCP when he denied allegations that the politicians who caused the bank's debacle were being shielded from criminal and legal proceedings.

“It is entirely wrong to blame them [politicians] for the current affairs,” he added.