The Reserve Bank of India (RBI ) superseded the Board of crisis-hit Punjab and Maharashtra Cooperative Bank Ltd. Mumbai and appointed Jai Bhagwan Bhoria as the administrator of the bank.
Last week, RBI increased the amount of withdrawal allowed to the depositors from ₹1,000 to ₹10,000. The directives of RBI shall remain in force for a period of six months.
The development comes at a time when the lender’s suspended MD reportedly admitted to the RBI that the ; bank’s actual exposure to the bankrupt HDIL is over ₹6,500 crore — four times the regulatory cap or a whopping 73% of its entire assets of ₹8,880 crore.
The slum redevelopment focused Housing Development and Infrastructure or HDIL is in the bankruptcy court ; now after being hit by a severe cash crunch following the failure of some of its key projects in the city.
RBI had reportedly recommended removal of the now scam-hit bank’s chairman Waryam Singh last year after it had found out his involvement in sanctioning loans to realty developer HDIL and related-entities without proper due diligence and much above the regulatory limits, a source has said.
Singh, however, continued to remain the chairman until recently, the person familiar with the development said.