Initial response looks 'positive' for PMC Bank resolution, says RBI Governor

Reserve Bank of India (RBI) Governor Shaktikanta Das on Friday said the response from potential investors for reconstruction of crisis-ridden Punjab and Maharashtra Co-operative Bank looks "positive" so far.

Last month, the fraud-hit multi-state urban cooperative bank sought Expression of Interest (EoI) from potential investors for investment or equity participation in the bank for its reconstruction. The deadline for issuing Information Memorandum (IM) was November 20 and for seeking pre-bid clarifications was November 30.

"The response looks positive at this point of time. The bank and its management are fully engaged with the investors who had purchased the information memorandum," Das told reporters after announcing the monetary policy.

The last date for submission of EoI by potential investors is December 15, he said, adding "let us see what is the response and after that we can take a view on this".

In September 2019, the RBI had superseded the board of PMC Bank and placed it under various regulatory restrictions after detection of certain financial irregularities, hiding and misreporting of loans given to real estate developer HDIL.

The central bank appointed A K Dixit as the new administrator of the bank in September this year.

While announcing the monetary policy on Friday, Das said, "with the preservation of financial stability and depositors' interest being uppermost in our agenda, we could swiftly resolve the situation at two scheduled commercial banks".

Two private lenders -- Yes Bank and Lakshmi Vilas Bank were rescued in 2020. When asked about the reasons for delay in finding a resolution for PMC Bank, the governor said PMC Bank's situation was completely different from the two banks that the RBI has resolved this year. 

(Photo Credit: Twitter/RBI)