PMC Bank withdrawal limit hiked to Rs 40,000 from 25,000

Nearly two weeks after the last revision, the Reserve Bank of India on Monday once again raised the withdrawal limit for depositors of Punjab and Maharashtra Cooperative (PMC ) Bank to Rs 40,000 from the prevailing Rs 25,000.

“The Reserve Bank of India, after reviewing the bank’s liquidity position and its ability to pay its depositors has decided to further enhance the limit for withdrawal to Rs. 40,000, inclusive of Rs. 25,000 allowed earlier,” the central bank said in a statement.

According to the RBI, the latest relaxation will allow about 77 percent of the bank’s depositors to withdraw their entire account balance.

On September 23, the RBI imposed operational restrictions for six months on PMC Bank, which included capping the withdrawals at Rs 1,000 per account. The move came after it found certain irregularities in the bank, including under-reporting of NPAs.

The withdrawal limit for account holders was raised to Rs 10,000 on September 26 and subsequently to Rs 25,000 on October 3.

“The financial position of the bank has been substantially impaired due to fraud perpetrated on it by certain persons,” the statement 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.”

The Economic Offences Wing of Maharashtra Police has started its investigations into the matter.

“Further, forensic auditors have been appointed by the Administrator of the bank to look into the related transactions,” the statement read.

“The Administrator and the 3 member Advisory Committee appointed by the RBI in terms of section 36AAA(5)(a) read with Section 56 of the Banking Regulation Act 1949 are working for speedier resolution of the various issues being faced by the bank in conducting its operations.”