Crisis averted at one more co-op bank in city

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Crisis averted at one more co-op bank in city Monday, March 19, 2001

Barely had the serpentine queues of depositors vanished from the gates of the city's co-operative banks last week after the Madhavpura Mercantile Co-operative Bank's payment crisis, when one more co-operative bank faced a crisis at the RBI clearing house on Saturday.
Sources in the banking industry said that the Classic Co-operative Bank Ltd, which is a clearing sub-agent of the Visnagar Nagrik Sahkari Bank Ltd, a scheduled bank, had an outstanding position in excess of Rs 20 crore at the RBI clearing house on Saturday afternoon.

However, painstaking efforts by top RBI officials ensured that the crisis was averted. A very senior RBI official is said to have supervised the clearing of the bank for more than one hour.

However, other sources said there was no problem as such with the bank's finances, but a pay order was stopped after instructions from the issuing party. Inquiries with the Reserve Bank's urban banks department elicited no response in this connection. The Visnagar and Classic Bank managements were also unavailable for comments. V S Das, the RBI regional director, could not be contacted despite several attempts.
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