PMC Bank: FM Nirmala Sitharaman says RBI taking action

The minister said the Reserve Bank of India is looking into the matter.

“Once again this evening, I shall talk to him (RBI governor) and convey the sense of urgency and distress that the clients of PMC have expressed before me and I shall request him to expedite the clearing of or giving permission for withdrawal of their monies which are deposited,” the minister  was quoted as saying by  Hindustan Times.

"According to the Directions, depositors will be allowed to withdraw a sum not exceeding ₹1,000 of the total balance in every savings bank account or current account or any other deposit account by whatever name called, subject to conditions stipulated in the RBI Directions," the RBI last month in a statement.

Further the Bank will also not be able to grant or renew any loans and advances, make any investment, incur any liability including borrow of funds and accept fresh deposits, disburse or agree to disburse any payment whether in discharge of its liabilities and obligations, unless RBI approves the same in writing.

The RBI has clarified that the bank’s licence is very much intact and it can continue to do business but with restrictions till further notice/instructions from the Central Bank.

The directions are subject to modification by Reserve Bank as per circumstances. The restrictions will remain in force for the next six months from Sep 23 after the close of business of the PMC bank, RBI informed.

PMC Bank, which is among the top 10 scheduled cooperative banks in the country, had total deposits of Rs11,617 crore and 8,383 crore in advances, respectively, as at 2019, March-end.