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Lift Curbs on Withdrawals by Punjab & Maharashtra Co-operative Bank Customers, Says Sanjay Nirupam

In a letter to RBI Governor Shaktikanta Das, Nirupam said the curbs on withdrawals will badly affect customers heavily dependent on the bank for their financial needs.


Updated:September 25, 2019, 8:20 PM IST
Sanjay Nirupam
File photo of Congress leader Sanjay Nirupam.

Mumbai: Congress leader Sanjay Nirupam on Wednesday asked the RBI to lift curbs on cash withdrawals by account-holders of the crisis-hit Punjab & Maharashtra Co-operative Bank PMC Bank) and said the regulator must fix accountability on individual directors for lapses.

Citing irregularities, including under-reporting of higher NPAs, the RBI on Tuesday placed the urban co-operative bank under operational restrictions such as not allowing it to give fresh loans, accept fresh deposits and borrowing of funds, among others, for six months.

One of the major restrictions affecting customers is capping withdrawals at Rs 1,000 per customer during the six-month period. The curbs include ATM transactions and online banking. In a letter to RBI Governor Shaktikanta Das, Nirupam said the curbs on withdrawals will badly affect customers heavily dependent on the bank for their financial needs.

"The RBI must lift restrictions on withdrawals from the bank accounts on a priority basis. There are a number of customers whose day-to-day life is dependent on bank transactions. "There should not be any restrictions on withdrawals. It is tragic that the common depositors cannot withdraw their own money due to mismanagement by bank officials."

The former MP asked the RBI to explain to PMC Bank customers whether it was just real estate firm HDIL which failed the lender or whether there were other NPAs or wilful defaulters who pulled it down.

The 35-year-old multi-state scheduled bank has exposure to several real estate companies which should be investigated, said the former Mumbai Congress president.

Accountability should be fixed on individual directors and investigation must take place into transactions between directors of the bank, real estate developers and other sundry debtors, Nirupam said.

He said the bank had a "huge" exposure to a defaulting real estate company which resulted in an unprecedented hike in its NPAs.

"I don't understand why the RBI is punishing common customers for the deliberate crime committed by the bank directors. The bank has gone through huge manipulation in its audit report which was discovered by the RBI very late during inspection," Nirupam said.

He sought stringent action against the bank's directors.

"Punitive action must be taken against the bank's directors and an FIR should be registered for their fraudulent duplicity. Inquiry must be conducted into the relations between the bank directors and failed builders," he said. ​

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