PMC Bank fiasco leads to panic among city’s housing societies

Panic set in among cooperative housing societies across the city after the Reserve Bank of India (RBI) imposed operational restrictions on Punjab and Maharashtra

Panic set in among cooperative housing societies across the city after the Reserve Bank of India (RBI) imposed operational restrictions on Punjab and Maharashtra Cooperative (PMC) Bank on Tuesday, amid a probe into accounting lapses at the financial institution.

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There are around 35,000 housing societies in Mumbai and more than 80% of them have accounts in various cooperative banks spread across the city. With the PMC Bank fiasco, they fear that their accounts might also be in jeopardy.

Vasant Shinde, director of the Mumbai Housing Federation, said, “There is widespread fear and an acute lack of confidence among housing society members towards cooperative banks.”

He said that managing committee members in housing societies are worried as they might be blamed for opening accounts in these cooperative banks.

Housing societies prefer accounts in cooperative banks as they gain higher interest rates compared to nationalised banks. In addition, the interest amount gained on these deposits is tax-free.

Kamlesh Apartments Cooperative Society at Sher-e-Punjab Colony in Andheri (East) lost more than ₹60 lakh worth of deposits in September 2016 when the RBI asked Maratha Cooperative Bank to freeze major operations. “We had to shell out extra money just to keep our building running,” said Ratnakar Pate, treasurer of the society.

probe pmc bank’s directors: nirupam

Former Mumbai Congress chief Sanjay Nirupam has demanded a thorough probe against the directors of PMC Bank. Nirupam added that the owners of the real estate company to which the bank allegedly offered loans and failed to declare them as bad loans, should also be investigated.

State minister claims accounts are stuck

State Minister for Housing and Shiv Sena Ravindra Waikar who has been one of the biggest depositor who has been been hit by PMC bank fiasco. His clubs like Matoshree and Supremo at Jogeshwari Vikhroli Link Road all have accounts in this PMC bank. He says he pays salaries to more than 200 member staff and crores of amount has been blocked due to the RBI order. “How can we pay salaries and run this club in such a scenario? My own personal and family accounts and FD’s are all struck n this bank,” rued Waikar. Waikar plans to lead the front to get depositors get back their hard earned money.