FM Sitharaman forms group to look into PMC Bank case; assures necessary steps

Finance Minister Nirmala Sitharaman on Thursday met with depositors of the Punjab and Maharashtra Co-operative Bank and assured them to take all the necessary steps to protect their interests. The FM said the RBI was doing "what's required to be done by law". On the question of making necessary changes in the law that governs co-operative banks, she said the Centre was working with the Rural Development Ministry to assess the shortcomings to do the required changes in the law.

"Finance Ministry may have nothing to do with it (PMC bank matter) directly because RBI is the regulator. But from my side, I've asked the secretaries of my ministry to work with Rural Development Ministry & Urban Development Ministry to study in detail as to what is happening," she said.

She said a group has been formed to look into the matter. The group, which would look into the PMC bank case, will have two secretaries of the finance ministry. "It'll also have deputy governor-level officials from the RBI at meeting, so that we take necessary legislative steps to prevent such things from happening in future & empower the regulator better," she added.

She said she had asked the secretaries of the ministry to study in detail as to what was happening. "Representatives of RBI will also be there to understand shortcomings, what happened, & also to therefore, if necessary, look at the ways in which the respective Acts will have to be amended," she added.

On taking actions against the culprits, she said: "In instances where there is malpractice & boards get bypassed, RBI handles the matter." The FM said if amendments in Acts would help in better regulation, the government was ready to do it. She said PMC Bank customers had requested her to increase the insured deposit amount. "Will take it up with the working group," she said.

Several PMC Bank account holders protested in front of Mumbai's Esplanade Court on Wednesday, demanding a strict action against Housing Development Infrastructure Limited (HDIL) directors, Sarang Wadhawan and Rakesh Wadhawan. The court has already extended the police custody of the father-son duo till October 14. Former chairman of PMC Bank Waryam Singh has also been sent to police custody till October 14. They will be further interrogated by the Mumbai Police in relation to the Rs 4,355-crore fraud at the bank.

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Edited by Manoj Sharma