CA Sudhir Pandit, one of the Directors of Janata Sahkari Bank of Pune and an erstwhile member of the Board headed by Mukund Abhaynakar has taken over as the new Chairman of the reconstituted Board of ailing Rupee Bank. The other members of the board include Arvind Khaladkar, Vijay Bhave and Sadanand Joshi.
Mukund Abhayankar had resigned earlier when the majority of Board members opposed the RBI move to give Rs 20 thousand to depositors. The new board was constituted on April 22.
The new board has decided to give an “initial relief” of Rs 5,000 to depositors. It would be a one-time payment until further orders. The relief would mostly apply to the depositors who have not withdrawn money even once after the Reserve Bank of India (RBI) put the bank under directions in February 2013, quotes Times of India.
The bank said the “initial relief” would settle the accounts of 4 lakh depositors because their “cumulative deposit was less than Rs 5,000. The disbursement of Rs 5,000 is expected to start within a month’s time.”
“We shall review the position periodically and see if we can give more relief to depositors,” said Sudhir Pandit, chairman of the new board of administrators.
In a piece titled “Rupee Bank: RBI insists, Board looks sideways” Indian Cooperative has exposed the stubbornness of the Board in ignoring RBI’s direction. The Reserve Bank of India had asked the co-operative department to implement its February 18 directive on Rs 20,000 withdrawal for Rupee Co-operative Bank depositors.
Sums Varma, the principal chief general manager of RBI’s department of cooperative bank supervision, reportedly asked the cooperative department representatives and the residual board to implement the directive.
On the latest move of the Board the former Chairman Mukund Abhayankar said “I cannot react as I am out of country. I would be back on 12th and would let you know my take on the development.”
Rupee bank has about 6.2 lakh depositors. The RBI has placed restrictions on the bank since 2013 owing to its poor financial health.