Vidarbha region's premier urban co-operative bank, Nagpur Nagarik Sahakari Bank Ltd (NNSB), has sought Reserve Bank of India (RBI) approval to acquire two Indore-based loss-making urban co-operative banks "" Maharashtra Brahman Sahakari Bank (MBSB) and Hindu Nagarik Sahakari Bank (HNSB). | |
| NNSB's shareholders have already passed resolutions for acquiring the two banks, based on proposals received from the two banks. MBSB has a deposit base of around Rs 75 crore with four branches and the single-branch HNSB about Rs 20 crore. NNSB has deposits of over Rs 400 crore. |
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| Ramesh Mantri, chairman of NNSB, said the necessary due diligence has been already been undertaken at both the cooperative banks. |
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| He said merger of the two Indore-based banks will have a negative impact of Rs 3 crore on NNSB's balance sheet, which the bank plans to amortise over five to 10 years and set-off the loss against income tax liability. NNSB has a capital of Rs 8 crore and reserves of nearly Rs 470 crore. |
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| NNSB is also open merger proposals from six more cooperative banks operating in Chhattisgarh and Madhya Pradesh. These banks have deposits ranging from Rs 5 crore to Rs 25 crore, with only three of them making losses. |
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| Mantri said even if all the banks are acquired, the impact on the balance sheet of NNSB would be negligible. |
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| If all the banks are merged, then NNSB's branches would increase to 40 from the present 26, apart from extending its reach outside Maharashtra. |
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