The Hindu 16.12.2010
Urban bank to revive transactions
Staff Reporter
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It stops operations from March 12, 2005, following RBI directive |
RBI lifts moratorium imposed on it
Deposit mobilisation to be launched afresh
BHIMAVARAM: The Bhimavaram Cooperative Urban Bank is poised to revive
its transactions after a five-year lull, thanks to the lifting of
moratorium by the Reserve Bank of India (RBI). Bank chairman Mantay
Padmanabham on Wednesday said the bank would shortly resume its
operations.
The RBI stalled the bank’s transactions by way of imposing a
moratorium on March 12, 2005 in the wake of alleged diversion of funds
to the tune of Rs. 22 crores by the then management of the urban bank
for investment in Vasavi and Charminar Banks which were closed following
the allegation of misuse of public funds. The action of the urban bank
triggered widespread protest among its customers leading to a long-drawn
agitation for getting back their deposits.
The RBI issued orders for lifting of the moratorium on Wednesday,
permitting the bank to go in for deposit mobilisation and credit
advancement afresh. Mr. Padmanabham said the bank would strive to clear
payment of pending deposits to its customers shortly with the help
available under the revival package offered by the RBI.
Revival package
The depositors already got back their amounts to the tune of Rs. 46
crores under the RBI’s revival package while another Rs. 30 crores was
still pending payment.
Mr. Padmanabham said that Rs. 11-crore cash reserves remaining with
the bank would be utilised for payment of deposits within a few days.