The Reserve Bank of India on Monday said that it had placed in public domain a draft scheme for the acquisition of Punjab and Maharashtra Cooperative (PMC) Bank and the and Unity Small Finance Bank (USFB). This draft scheme works though the takeover of the assets and liabilities of PMC Bank including deposits by the USFB. This, the central bank said, is aimed at making the depositors feel more safe. The USFB, a banking company incorporated under Companies Act, 2013, and having its Registered Office in New Delhi, has started its operations from the beginning of this month, the RBI said in a statement.
The USFB is being set up with a capital of about Rs 1,100 crore as against the regulatory requirement of Rs 200 crore for the setting up of such a bank, as per the guidelines for on-tap licensing. The Reserve Bank said it would receive suggestions and objections on the draft scheme till 5.00 pm on December 10. Thereafter, it will take a final view on the takeover.
“The draft scheme of amalgamation published today, envisages takeover of the assets and liabilities of PMC Bank including deposits, by the USFB in terms of the provisions of the scheme giving a greater degree of protection for the depositors. It may be seen that USFB is being set up with capital of about Rs 1,100 crore as against regulatory requirement of Rs 200 crore for setting up of a Small Finance bank under the Guidelines for on-tap licensing of Small Finance bank in Private Sector date December 5, 2019, with provision for further infusion of capital at a future date after amalgamation,” the bank said in a statement.
The depositors of the PMC bank will get their money back over a period of three to 10 years, the RBI said in its draft.
Equity warrants of Rs 1,900 crore, can be exercised anytime within a total period of eighr years, have been issued by Unity Small Finance Bank Ltd. on November 1, 2021 to the promoters to bring further capital, as per the draft scheme. “It (the scheme) shall come into force on such date as the Central Government may, by notification in the Official Gazette, appoint,” it added.
The RBI has invited suggestions and objections, if any, from members, depositors and other creditors of transferor bank (PMC) and transferee bank (USFB), on the draft scheme. These are to be sent to the given address on the notice by December 10, 5 pm. Further decision will be taken after that, the bank said. The draft scheme has also been sent to transferor bank and transferee bank for their suggestions and objections.
Punjab and Maharashtra Cooperative Bank has been put under restrictions, including limiting withdrawals, by the RBI, following the unearthing of a Rs 4,355-crore scam. In December last year, The Delhi High Court pulled up the RBI for leaving it to the scam-hit bank to decide which emergencies cited by its depositors were to be considered for disbursal of Rs 5 lakh to them, saying since the central bank imposed the restrictions it should have been the one taking the decision.
(With inputs from PTI)
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