Cash-strapped Punjab and Maharashtra Co-operative (PMC) Bank has received four expressions of interest (EoIs) for investment in its reconstruction scheme, the Reserve Bank of India notified on Friday. The central bank has also extended restrictions on PMC Bank by three more months until March 31, 2021.
As per the RBI, the PMC Bank, which has been under direction since September 23, 2019, has received four investment proposals from eligible investors for its reconstruction. Last date for submission of EoIs was December 15, 2020.
PMC Bank will examine viability and feasibility of these proposals, considering the best interest of the depositors. To undertake this process, the bank would need some more time, the RBI said.
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"The bank has informed Reserve Bank that in response to EoI, four proposals have been received. These proposals will be examined by the bank with regard to their viability and feasibility taking into account the best interest of the depositors. To undertake this process, the bank would need some more time," the central bank said.
Last month, the co-operative bank had invited EoIs from interested investors for its reconstruction. The exercise is meant to find equity investors willing to take over its management in order to revive the beleaguered lender and resume its day-to-day operations.
The RBI stated that it was necessary to extended restrictions on PMC Bank by three more months until March 31, 2021, keeping in view the best interest of all stakeholders. The directions were last extended on June 19, 2020 up to December 22, 2020.
"All other terms and conditions of the Directives under reference shall remain unchanged," RBI said.
PMC Bank was placed under directions by the RBI on September 29, 2019, after a money laundering scam came to light. The central bank discovered that the lender allegedly created fictitious accounts to hide over Rs 6,700 crore in loans extended to the almost-bankrupt Housing Development Infrastructure Ltd (HDIL). The urban co-operative bank and the RBI have been exploring avenues for its resolution and recovery of bad loans.
By Chitranjan Kumar