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Kathiria draws plan to revive MMCB Tuesday, May 1, 2001

Ahmedabad: Final touches are being given to revival plan of the beleaguered Madhavpura Mercantile Cooperative Bank, which will be presented to the RBI and the Central government this weekend, Union minister of state for heavy industries Dr Vallabh Kathiria told The Asian Age on Monday.

Dr Kathiria, who has taken up the cause of the revival of the bank, said the Gujarat Cooperative Banks Federation, the state government and the Central government, including the finance ministry and RBI are positive about the plan and are taking keen interest for the revival of the bank.

Dr Kathiria said, “Members of cooperative bank would contribute around Rs 600 crore as soft loans to cover up the deficit. The modalities of sharing the money between different banks are being worked out. Financially sound cooperative banks would contribute more funds while those banks, which have lesser deposits, would contribute less,'' he added.

“Leaders of the co-operative banks of the state cutting across the party line have agreed to contribute for the revival,'' he added. Dr Kathiria said the revival plan will also propose permanent ban on premature deposit withdrawal.

The cooperative sector is demanding to give credit guarantee from the central government against the money they would give as soft loans. Dr Kathiria has made representations to the home minister L K Advani, finance minister Yashwant Sinha and also to the Prime Minister Atal Behari Vajpayee over the issue.

“The government has promised that maximum credit guarantee would be provided by the central government,” he added. The final discussion on the plan would be held in by the cooperative banks' federation on May 4.

The plan would be submitted to the RBI on Saturday. The RBI in turn will send the plan to the finance ministry. Dr Kathiria, giving example of the Vijay Commercial Cooperative Bank of Rajkot, said that the bank which was declared insolvent a few years back was revived due to the efforts of cooperative banks of Rajkot and is a profit making bank now.

“That is the example in front of us, which is to be followed,” he said. Dr Kathiria, who is the founder member of the recently formed National Cooperative Forum of India, is interested in spreading of cooperative movements throughout the country.

“Gujarat is an important state for cooperative movement and success of state in cooperative ventures is important to set an example. So I am taking keen interest in revival of the bank."

 

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