Restrictions On PMC Bank Extended By RBI Till Dec 31

On Friday, the Reserve Bank of India, the central banking authority of the country, further extended the restrictions on PMC Bank (Punjab and Maharashtra Co-operative bank) till December 31 within a week after consortium including Centrum Financial Services and BharatPe proposed a takeover. The board of PMC was suspended earlier in late 2019 on account of accusations of money laundering, accounting lapses, and financial irregularities. RBI said, some more time would be required to complete the reconstruction of PMC Bank before removing the restrictions on the bank. The RBI release said,”Accordingly, it is hereby notified for the information of the public that the validity of the aforesaid Directive dated September 23, 2019, as modified from time to time, has been extended for a further period from July 1, 2021, to December 31, 2021, subject to review.”

The two acquiring companies – Centrum and BharatPe – will set up an SFB, or a small finance bank, which will merge with PMC Bank and take over its administration, providing a much-awaited relief to its depositors whose money has been locked up for the last two years. PMC had a total of Rs 10,727 crore in deposits as of March 31, 2020, and had recorded a net loss of Rs 6,835 crore during 2019-2020.