Few months ago, Pimpri Chinchwad civic body had Rs 3,000 crore deposits with Yes Bank
PCMC had earlier deposited Rs 3000 crores with Yes Bank but later gradually shifted its reserves to other private banks. The high interest rates offered by the bank was the reason why it was preferred by the civic body.
The Pimpri Chinchwad Municipal Corporation (PCMC) which presently has deposits of Rs 984 crore with Yes Bank had at one time, deposits of nearly Rs 3,000 crore with the bank, municipal commissioner Shravan Hardikar said on Saturday.
In the neighbouring Pune Municipal Corporation (PMC), Ulka Kalaskar, chief accountant and finance officer of PMC said, “We only have about Rs 105 crore in Yes Bank currently as we had withdrawn about Rs 366 crores a few months ago after maturity. So currently, only 10 percent of the Rs 1600 crore FD of PMC is in one Yes Bank account. We will write to the RBI seeking clarification as to how we can withdraw this amount too.”
According to Hardikar, PCMC had earlier deposited Rs 3000 crores with Yes Bank but later gradually shifted its reserves to other private banks. The high interest rates offered by the bank was the reason why it was preferred by the civic body, he said.
The deposits of Rs 984 crore with the bank presently include the civic body’s revenue collection from various sources like water tax, property tax, building permission fees and other heads.
“The civic body has been depositing the amount with Yes Bank since 2017 and the deposits were diverted from other banks to Yes Bank as Yes Bank offered higher interest up to 8 % while the other banks offered 5 percent as interest. All due diligence was done and necessary procedures were followed,” he said.
He said there was no cause for worry as the civic body has Rs 4000 crore as reserves in other banks. The PCMC administration had signed an official agreement with Yes Bank for online transactions and tax recovery in 2017. Yes Bank was authorized to collect all forms of online taxes under different heads of the civic body and these funds were deposited with the bank as it had promised interest returns as high as 8 percent.