The Reserve Bank of India and the Maharashtra government will form two taskforces for co-operative urban banks (TAFCUB) to work out action plan including revival, merger and exit (closure) route for 170 weak urban cooperative banks (UCBs). | |
| The task force will take up cases on priority basis of banks in Grade IV ( UCBs which do not meet financial and technical criterion prescribed by RBI), negative net worth, those under RBI direction, working under administrator and 8 unlicensed banks, state government sources said. |
| |
| There is maximum concentration of UCBs in Maharashtra. It has about 1/3 of the UCBs (630) out of total urban banks the country (1853) and accounts for deposits worth about Rs 70,000 crore, RBI Governor Y V Reddy told reporters after addressing meeting of TAFCUB here. |
| |
| Hinting at steps to support the growth of UCBs, the governor said RBI will also look at issuing licenses to healthy urban banks to open new branches and enter new lines of businesses. The final decision this will be taken after assessing balance sheet for year ending 2007. |
| |
| RBI will also work on fresh guidelines for starting new urban banks. This will happen only after clearing overhang of problems besetting this sector, he added. |
| |
| The task force will solve the issue of dual controls by ensuring better co-ordination between the three stakeholders of urban co-operative banks""RBI, state government, and the banks themselves, Reddy said. |
| |
| As of now, 70 per cent of UCBs have come under the jurisdiction of the task forces in India and it is expected to go up to 90% in the next few months. |
| |
|
| |
