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PMC Bank: Sitharaman faces protesters; promises legislation

Finance Minister Nirmala Sitharaman on Thursday faced irate depositors of Punjab and Maharashtra Cooperative (PMC) Bank, and promised to bring in legislative changes for upholding of their interests.

The depositors had gathered outside the BJP’s office here ahead of Sitharaman’s scheduled press interaction in the run-up to the October 21 Maharashtra Assembly election.

The PMC Bank was put under “directions” by the Reserve Bank of India (RBI) last month due to weak financial health, wherein the central bank has capped the deposit withdrawals at Rs 25,000.
The PMC is in bad health allegedly due to its exposure to the near bankrupt realty player HDIL, to which it has loaned over 70 per cent of its Rs 9,000 crore in advances.

At the press interaction, Sitharaman said secretaries from the department of financial services and economic affairs would be meeting a deputy governor of the RBI soon to look into the “shortcomings” of the functioning of multi-state cooperative banks and see if any amendments could be made to the laws.

“They will discuss legislative steps needed to prevent such incidents and empower the regulator better,” Sitharaman said.

The BJP-led government would bring in legislation to this effect in the winter session of Parliament, she said.

The minister said she would speak to RBI Governor Shaktikanta Das about the interest of the depositors and convey their urgency and distress.

She also told the irate depositors that the RBI is looking into the matter.