The Hindu Business Line : `Panel report on co-op banks to be submitted in a fortnight'

THE report of Vaidyanathan Committee on co-operative banks is to be submitted to the Union Government within a fortnight, according to Mr V. Leeladhar, Deputy Governor, Reserve Bank of India.

The central bank and the Government would "look into the matter and do the needful" after they receive the report, he told presspersons on the sidelines of a function on Corporate Governance.

The committee was formed under the chairmanship of Prof A. Vaidyanathan as per the announcement made by the Finance Minster in his Budget speech on July 8.

This task force was appointed by the Government to look into matters relating to co-operative banks.

Speaking at the function, Mr Leeladhar emphasised the importance of corporate governance in co-operative sector, as these banks have experienced grave problems in recent times.

Co-operative banks are facing the need for restoring customer confidence.

"Co-operative corporate governance is about ensuring co-operative relevance and performance by connecting members, management and the employees to the policy, strategy and decision making processes," said Mr Leeladhar.

"Since the market control is not sufficient to ensure proper governance in banks, Government does see reason in regulating and controlling the nature of activities, the structure of bonds, the ownership pattern, capital adequacy norms, liquidity ratios," he added.

Citing disclosure and transparency as key pillars of corporate governance framework, Mr Leeladhar said that RBI has made this clear with the abolition of minimum lending rates for co-operative banks and making it compulsory for these banks to publish the minimum and maximum interest rates charged by them and display this information in every branch.