Money & Banking

RBI raises withdrawal limit for PMC depositors to ₹50,000

Our Bureau Mumbai | Updated on November 05, 2019

PMC Bank account holders hold placards and raise slogans as they protest outside RBI office in Mumbai.   -  PTI

The Reserve Bank of India (RBI) has upped the withdrawal limit by ₹10,000 for the distraught depositors of the scam-hit Punjab and Maharashtra Bank Co-operative (PMC) Bank. The new withdrawal limit is now ₹50,000 of the total balance in their accounts.

To ease the process of withdrawal, the RBI has allowed the depositors to withdraw from the bank’s own ATMs within the prescribed limit of ₹50,000. The RBI, in a statement, said the decision to further enhance the limit for withdrawal to ₹50,000, inclusive of ₹40,000 allowed earlier, was taken after reviewing the bank’s liquidity position and its ability to pay its depositors.

Read more: RBI enhances withdrawal limit for PMC customers to ₹40,000

This is the third time since the Bank was put under Directions from the close of business on September 23 that the deposit withdrawal limit has been increased.

Also read: RBI puts Mumbai-based PMC Bank under directions

With the latest relaxation, more than 78 per cent of the depositors of the bank will be able to withdraw their entire account balance, the central bank said in a statement.

PMC Bank exposure

The Reserve Bank said it is closely monitoring the position and shall continue to take further steps as are necessary to safeguard the interest of the depositors of the bank.

According to the central bank, the financial position of the bank has been substantially impaired due to fraud perpetrated on it by certain persons. The Bank reportedly has a huge single party exposure of almost two-thirds of its total loan book to the bankrupt HDIL Group, which stopped servicing the loans a couple of year back..

In a statement on October 14, the RBI said, “As soon as the matter came to the notice of Reserve Bank of India, action was taken in appointing an Administrator and ensuring that the bank’s available resources are protected and not misused or diverted.

“Meanwhile, based on a complaint filed by the bank against its officials and borrowers associated with the fraud/financial irregularities in the bank and manipulation of its books of accounts, the Economic Offences Wing, Maharashtra Police has started its investigations into the matter.”

Further, Forensic Auditors have been appointed by the Administrator of the bank are looking into the related transactions. The Administrator and the 3 member Advisory Committee appointed by the RBI are working for speedier resolution of the various issues being faced by the bank in conducting its operations.

Depositors have hit the streets to get their money back, holding protests in front of RBI’s main office as well as Bandra-Kurla Complex office in Mumbai, ever since PMC Bank got into trouble.

Published on November 05, 2019

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