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MMCB revival scheme notification in 3 days Friday, July 6, 2001
By A Staff Reporter, The Times of India News Service
AHMEDABAD: Even as there is widespread cynicism on the ability of the revival committee to mobilise Rs 800 crore from the various co-operative banks in the state for the revival of the Madhavpura Mercantile Co-operative Bank (MMCB), the Ahmedabad District Co-operative Bank (ADCB) chairman Amit Shah is confident of raising this fund.
He said the notification of the Rs 1,264-crore revival scheme, approved in Delhi last month, will be issued by the Central Registrar of Co-operative Society (CRCS) in the next three days.
"As these co-operative banks' contributions for the revival of MMCB would be from the 25 per cent of the Statutory Liquidity Requirement (SLR) which is kept with the apex co-operative bank, the question of not being able to raise the sum does not arise. All co-operative banks would just be moving their funds from one place to another. Also, there is a default guarantee on the sum by both the central and the state government. This offers enough security to cover their contributions," Shah said.
He said the notification of the scheme is being delayed, as the RBI deputy governor (Urban Bank Department) Jagdish Kapoor retired on June 30, and the new deputy governor would take some time to study and understand the revival scheme.
According to Shah, the notification of the scheme would help in the early release of the Rs 464-crore Deposit Insurance Credit Guarantee Corporation (DICGC) funds, as following such notification any violation of any law would automatically get amended.
"Once the scheme is notified by the CRCS, there would be no need for amendment of any law. The DICGC will be able to release the Rs 464-crore deposit insurance in less than a week after the notification," says Shah.
After the notification, the RBI, the central and state government and the Deposit Insurance Credit Guarantee Corporation (DICGC) will have to issue a circular about the special relaxation of Section 71 G, which would permit investment by co-operative banks into the MMCB.
Shah said the new board - which will comprise of one representative from the central government, two from the state government, one from the ADCB, one from the Gujarat State Co-operative Bank, three from the City Bank and Gujarat Co-operative Bank Federation and two from co-operative banks contributing more than Rs 50 crore - will be formed in another one and a half months. He also ruled out any name-change of the MMCB.
News Source : Times Of India News Service [ Lightning News ]