Maharashtra to Deregister Non-functional Coop Banks
The registrar of cooperative societies at Mumbai has begun the process of deregistration of cooperative banks, which have remained non-functional for over 10 years, with no sign of revival, under the provisions of the Maharashtra Co-operative Societies Act, 1960.
 
Under section 84 of the above act, the books of the indebted society are inspected and under section 103, a liquidator is appointed to take stock of the liabilities, assets, and depositors’ claims as part of the wind-up procedure. Now the respective deputy registrars of cooperative societies from Mumbai have been asked to submit reports by the current month-end to the commissioner, cooperatives so that further action can be taken. 
 
The Reserve Bank of India (RBI) has already cancelled banking licences of these banks. Some of the banks facing deregistration include: Metropolitan Co-operative Bank Ltd, Mumbai (date of liquidation by RBI -20 June 1992), Chetna Co-operative Bank Ltd., Mumbai (date of liquidation 1 December 1994), Swastik Janata Sahakari Bank Ltd., Mumbai (date of liquidation -14 December 1994), Mafatlal Engg. Employees Co-operative Bank Ltd., (date of liquidation – 31 March 2002), Vinkar Sahakari Bank Ltd., Mumbai (date of liquidation -24 August 1998), Awami Mercantile Co-operative Bank Ltd., Mumbai (date of liquidation -6 January 1999), Ravikiran Urban Co-operative Bank Ltd., Mumbai (date of liquidation -15 January 1999), Indira Sahakari Coop Bank Ltd., Mumbai (date of liquidation -29 June 1999), Dadar Janata Sahakari Bank Ltd., Mumbai, (date of liquidation -26 February1998), Maratha Market Peoples Co-operative Bank Ltd., Mumbai(date of liquidation -14 August 2000), Friends Co-operative Bank Ltd., Mumbai (date of liquidation -8 August 2001), Western Co-operative Bank Ltd., Mumbai (date of liquidation -20 December2001),  Shree Labh Co-operative Bank Ltd., Mumbai (date of liquidation -13 August 2002), Yeswant Sahakari Bank Ltd. Mumbai (date of liquidation -7 March 2003), Swami Samarth Coop Bank, Mumbai, Raghuvanshi Coop Bank, Mumbai and Parivartan Coop Bank, Mumbai.
 
Of these, all the depositors of Raghuvanshi and Parivartan are eligible to get their claims up to Rs1 lakh from the Deposit Insurance and Credit Guarantee Corporation (DGCGC).
 
These banks fall under the jurisdiction of the district deputy registrar (DDR) I, II and III. The process to deregister these banks is on DDR III, Mahendra Mhaske, district deputy registrar said.
With 4,839 branches and 1,576 ATMs, cooperative banks have made their presence felt in every nook and corner of the state. In rural areas, cooperative banks are the only banks available to a large section of population. The RBI and commissioner of cooperatives have joint control over these banks.
 
Maharashtra has a 32% share of co-operative banks in the country. Of the 1,618 urban coop banks in the country, 526 urban banks are in Maharashtra. As of now, nearly 106 coop banks are facing liquidation and another 10 are under the control of administrators. The coop banks, have stated to have non-performing assets to the tune of 10-15% and total deposits in these are to the tune of Rs1,73,800 crore, which accounts for 68% of deposits in such banks in the country. Besides, the cooperative banks in Maharashtra have issued loans to the extent of 65% of loans given by cooperative banks in the country.
 
As such the financial health of coop banks in Maharashtra is suffering. Mismanagement, lack of professional handling and political interference has hurt cooperative banking in the state. Besides, demonetisation of bank notes in November 2016 has crushed the backbone of most of the coop banks in the state.
 
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COMMENTS

SRINIVAS SHENOY

2 months ago

Mismanagement of the banks alongwith political interference should be dealt with sternly in the interests of the depositors and for the health of the banking sector.

PNB fraud: Interpol issues red corner notice against Nirav's sister
Interpol has issued a red corner notice (RCN) against Purvi Deepak Modi, sister of fugitive diamantaire Nirav Modi who is wanted in the Rs13,500 crore Punjab National Bank (PNB) fraud case, officials said on Monday.
 
According to the Enforcement Directorate (ED) the Interpol issued the RCN against Purvi Modi on the charge of money laundering, as requested by it.
 
In August, a special court in Mumbai had issued public summons to Nirav Modi's sister Purvi and brother Neeshal, who are Belgian citizens, to appear before it on September 25. The court also said that if they fail to appear then their properties would be confiscated under the newly enacted fugitive offenders act.
 
According to ED officials, Purvi Modi and other family members of Nirav Modi were the recipients of the proceeds of the crime.
 
Last week, Interpol issued a RCN against Nirav Modi's close aide Mihir Bhansali in connection with the case.
 
Bhansali, who was an executive in Nirav Modi's Firestar International firm, is absconding since the probe started in the alleged $2 billion PNB fraud case.
 
The RCN is issued to seek the location and arrest of wanted person(s) with a view to extradition or similar lawful action.
 
The ED wants to question Purvi Modi and Bhansali to unearth further details of the fraud committed by Nirav Modi and his uncle Mehul Choksi of the Gitanjali group to cheat the Mumbai-based PNB's Brady House branch.
 
The Interpol, in its notice, requested its 192 member countries to arrest or detain Bhansali so that his extradition process could begin.
 
The Interpol has issued a similar notice against Nirav Modi, who as well as his family and uncle Choksi left the country in January, a month before the fraud came to light.
 
The notice mentions Bhansali's birth place Mumbai and gives his date of birth as November 15, 1977.
 
Purvi Modi's photo is also pasted on the notice.
 
Disclaimer: Information, facts or opinions expressed in this news article are presented as sourced from IANS and do not reflect views of Moneylife and hence Moneylife is not responsible or liable for the same. As a source and news provider, IANS is responsible for accuracy, completeness, suitability and validity of any information in this article.

 

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Sustained rupee falling credit-negative for Indian companies: Moody's
The ongoing free fall of the rupee against the US dollar is credit negative for Indian companies, especially for those that generate revenue in rupees but rely on dollar debt to fund their operations and have substantial dollar-based expenses, Moody's Investors Service said on Monday.
 
The American credit rating agency's report on the weakening rupee was published on the day the Indian currency touched a new low of 72.67 on Monday, depreciating by almost a rupee from its previous close of 71.73 per US dollar. The rupee has depreciated 13 per cent so far this year against the dollar. 
 
"A sustained "weakening of the rupee would be credit negative for its rated Indian companies, particularly those that generate revenue in rupees but rely on the US dollar debt to fund their operations and have significant dollar-based costs, including capital expenses," Moody's said."
 
However, of the 24 Moody's-rated India-based corporates across the high-yield and investment-grade categories, 12 generate most of their revenue in US dollars or have contracts priced in the greenback, providing a natural hedge, and thus limiting the effect a weakening in the rupee could have on their cash flows, it said.
 
"Nevertheless, most rated India-based corporates have protections in place, including natural hedges, some US dollar revenues and financial hedges, to limit the negative credit implications of a potential further 10 per cent weakening of the rupee to the US dollar from Thursday's (September 6) rate," Moody's Vice President Annalisa D'Chiara said in the report. 
 
"Furthermore, the impact of the rupee's weakening will be diverse and will also depend on issues such as a particular corporate's reliance on exports, its cost base, and its exposure to pricing on international markets," she added.
 
The 24 corporates rated by Moody's include those in the IT, oil and gas, chemicals, automobiles, commodities, steel and real estate sectors.
 
According to the US agency, weaker credit metrics under a scenario of a further 10 per cent drop in the value of the rupee, from the rate on September 6, can be accommodated in the companies' current rating levels.
 
"Furthermore, refinancing risk associated with the companies' US dollar debt maturing over the next 12 months is manageable," it said. 
 
The Moody's report follows its annual survey of the US dollar debt exposures of South and Southeast Asian high-yield companies, published in June 2018, which considered the effects of the rupee weakening to around Rs 78 to the US dollar.
 
Disclaimer: Information, facts or opinions expressed in this news article are presented as sourced from IANS and do not reflect views of Moneylife and hence Moneylife is not responsible or liable for the same. As a source and news provider, IANS is responsible for accuracy, completeness, suitability and validity of any information in this article.

 

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