Indian Overseas Bank (IOB) is all set to start its operations on April 16 with the Reserve Bank of India (RBI) giving a nod to the transfer of specific assets and liabilities of the Shree Suvarna Sahakari Bank (SSSB) to the IOB.
Cooperatives Commissioner Krishna Lavhekar on Tuesday sanctioned the transfer under Section 110 (A) of the Maharashtra Cooperatives Society Act. “We got the green signal from RBI and we have issued the orders as per the act in the scheme of arrangements,” said Lavhekar. RBI had put the Pune-based cooperative bank SSSB under moratorium in September 2006, following huge non-performing assets (NPAs) non-recovery of loans and non-compliance with RBI guidelines in case of loan approvals worth Rs 436.74 crore. In November following a complaint filed by a special auditor, the chairman Dyaneshwar Agashe and several other directors of the bank were taken into legal custody following charges of financial irregularities. The bank had deposits of over Rs 700 crore and NPAs accounted for more than Rs 300 crore, primarily due to connected lending.
When contacted, chairman and managing director of IOB, SA Bhat said that if the letter is ready, then all things will go according to the plan. “We should be able to operate by April 16,” he said. On giving back depositors the money, he said that those depositors who would want to continue with us can do so and those who want to withdraw can do it after April 16.
The SSSB depositors who have been waging a two-year old battle are a relieved lot with this move. However they would wait till April 16, before jubiliations. Shrikant Limaye who leads the depositors movement, told The Indian Express that there are around two lakh depositors who have to get their money back. “The taking over and operations is a good sign. Ofcourse, we are very hopeful and with the cooperative commissioner giving the sanction, it should happen. We hope to get our money back,” he said. The depositors have their meetings on Sundays and is scheduled to have one on April 5 regarding this development. It took nearly 10 months for the IOB to get the formal sanctions to take over the assets and liabilities of the cooperative along with its branches. The approval took time following a special audit ordered by the Registrar of Companies (RoC) of the state government. RoC is the state-specific regulatory body that jointly regulates cooperative banks along with RBI.
The differences in the legal structure of IOB and a co-operative bank also further complicated the process of securing approval for the branches of the co-operative bank. The 37-year-old cooperative bank, SSB has 12 branches, nine in Pune, two in Mumbai and one in Shripur.
Express News Service