The Hindu Business Line : Deposits up to Rs 1 lakh will be repaid in three months: Prudential Liquidator

ALLAYING the apprehensions of thousands of depositors who thronged the headquarters of Prudential Bank here on Thursday, the Liquidator appointed as per the Reserve Bank of India directives, Mr V. Amarender Rao, assured them that the bank would ensure repayment of their deposits of up to Rs 1 lakh in the next three months.

After elaborate sessions with both the employees and depositors of the bank, Mr Rao told Business Line that the mandate given to him was to immediately initiate measures towards realising assets and discharging liabilities of the bank.

He said repayments to depositors for amounts of up to Rs 1 lakh would be arranged from the Deposit Insurance and Credit Guarantee Corporation in three months time. "The payments for amounts above Rs 1 lakh will depend on the level of recoveries to be made."

Mr Rao said, "We will now expedite the legal proceedings against the defaulters by appointing more Sale Officers in the bank. We will file Execution Petitions against defaulters, move the Debt Recovery Tribunals and also invoke the provisions of the Securitisation Act for early recoveries."

Responding to the apprehensions of employees on their job security, Mr Rao said all the 344 employees would be retained and paid salaries at least for a period of six months. Continuing their services would depend on the flow of recoveries, he said.

Appreciating the efforts of the employees in recovering around Rs 187 crore of NPAs in the last couple of years, he said the Employees Union representatives have assured their support for early recoveries.

Meanwhile, refusing to open the branches and initiate the recovery measures in the absence of a clear assurance for their jobs, the Employees Union representatives urged the Liquidator to protect the interests of employees.

Stating that there was a shortfall in insurance premium to be paid towards gratuity of employees, the union asked the Liquidator to ensure payment of the insurance premium in the event of resignation, retrenchment or removal of employees on any grounds, so that the insurance company would pay gratuity to all the employees.

The union has also demanded that the deposits of the staff should be adjusted towards their loan outstandings and make payment of deposits to those employees who did not avail of any loans.

In the case of resignation, retrenchment or removal on any ground, each employee should be given a package of Rs 10 lakh, the Union General Secretary, Mr B. George Reddy, said.

Meanwhile, opposing the RBI move to cancel the licence of the bank and demanding merger of the bank either with a nationalised bank or with the AP Co-operative Bank, the depositors and employees unions have decided to organise a rally from the bank's headquarters on Friday to the State Assembly.

Both the unions propose to submit memorandums to the Government and the Opposition leaders for protecting their interests and early revival of the bank.

More Stories on : Investor Protection | Co-operatives | Andhra Pradesh

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