Three investors have submitted their final offers for resolution of crisis-ridden Punjab and Maharashtra Co-operative (PMC) Bank and their evaluation is underway, Reserve Bank Governor Shaktikanta Das said on Friday. Last month, the bank's administrator A K Dixit had said that three investors were given time till February 1, 2021 for submissions of their final offer. "I have been informed that three final offers have been received. I am given to understand that the PMC bank itself is evaluating the offers," the Governor told reporters after announcing the monetary policy.
He said once the evaluation is done, the bank would approach RBI. In September 2019, RBI had superseded the board of PMC Bank and placed it under various regulatory restrictions after detection of certain financial irregularities, hiding and misreporting of loans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. Its exposure to HDIL was over Rs 6,500 crore or 73 per cent of its total loan book size of Rs 8,880 crore as of September 19, 2019. Initially, the restrictions, including withdrawal of deposits and fresh lending, were imposed for six months but RBI has been extending the curbs. On December 18, it announced a further extension till March 31, 2021. In November last year, the fraud-hit multi-state urban cooperative bank had invited expressions of interest (EoIs) from potential investors for investment or equity participation in the bank for its reconstruction. EoIs were invited to identify a suitable equity investor/ group of investors willing to take over management control so as to revive the bank and commence regular day-to-day operations.
Dixit, in his letter to customers and shareholders dated January 18, 2021, wrote that initially, four investors had shown their interest but three went ahead with the further process. He had said investors need to have a full understanding of the financial position of the bank before giving their final offer and were doing due diligence. The three investors were allowed time till February 1 for submission of their offer, Dixit wrote in the letter. As per the EoI document, subsequent to commencement of the normal day-to-day operations, it will be open for the investors to convert the bank into a small finance bank by making an application to RBI.
PMC Bank's total deposits stood at Rs 10,727.12 crore and advances at Rs 4,472.78 crore as of March 31, 2020. Gross NPA stood at Rs 3,518.89 crore as of end-March. During 2019-20, it registered a net loss of Rs 6,835 crore and has a negative net worth of Rs 5,850.61 crore.
Read all the Latest News, Breaking News and Coronavirus News here(This story has not been edited by News18 staff and is published from a syndicated news agency feed)