CM justifies action against MSC Bank

A day after union agriculture minister and the Nationalist Congress Party boss Sharad Pawar said in New Delhi that the Maharashtra government could have avoided action against the Maharashtra State Cooperative Bank, chief minister Prithviraj Chavan said the Reserve Bank of India (RBI) primarily recommended action against MSC Bank because the bank did not follow RBI guidelines since 1996.

A day after union agriculture minister and the Nationalist Congress Party boss Sharad Pawar said in New Delhi that the Maharashtra government could have avoided action against the Maharashtra State Cooperative Bank, chief minister Prithviraj Chavan said the Reserve Bank of India (RBI) primarily recommended action against MSC Bank because the bank did not follow RBI guidelines since 1996.

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He said the RBI expected the MSC Bank to operate like a banking institute.

Chavan said he has been working on a war footing to help the apex bank and its affiliated units to recover speedily from the mess. He said on Wednesday at his Vidhan Bhavan office that at least seven district cooperative banks affiliated to the MSC Bank were also in negative worth and needed urgent help. He did not name these banks. The MSC Bank has 34 affiliated units across the state.

When asked what would be the impetus that the state planned to give to the MSC Bank whose board was superseded wide a RBI directive early this month, Chavan said he had not decided on it yet. “We still don’t have a report on the overall situation. I have asked for a consolidated report on all banks including the apex bank.