Congress all set to bail out MSC Bank

Having demonstrated that it was ready to paint the Nationalist Congress Party (NCP) into a corner, the Congress is now all set to bail out the Maharashtra State Cooperative Bank dominated by its alliance partner.

Having demonstrated that it was ready to paint the Nationalist Congress Party (NCP) into a corner, the Congress is now all set to bail out the Maharashtra State Cooperative Bank dominated by its alliance partner.

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Ever since the RBI asked for dissolution of the apex bank's board of directors for mismanagement and irregularities, the two allies have been engaged in a tussle over the bank's affairs.

Chief minister Prithviraj Chavan, state Congress unit chief Manikrao Thakre and party leader in-charge of Maharashtra Mohan Prakash decided in New Delhi on Thursday that they should take the lead in burying the hatchet with the NCP and discuss with Pawar's party ways to bail the bank out quickly so that it is able to finance various affiliated district banks in the kharif (monsoon) season.

The bank is the principal funding agency for all co-operative banks and credit societies in the state, which play a crucial role in providing funds to farmers for agricultural activities.

The alliance partners are expected to meet in Mumbai in a couple of days to finalise the bailout plan, sources added.

The RBI action had almost brought the government's functioning to a halt as NCP leaders and deputy chief minister Ajit Pawar stopped interacting with the CM. On Thursday, the leaders met in New Delhi for a meeting with the Planning Commission.

A senior official who requested anonymity said the bank's accounts for 2010-11 indicated its finances were getting better and disciplinary action not needed.