The Reserve Bank of India Tuesday increased the cash withdrawal limit for depositors in the beleaguered Punjab and Maharashtra Cooperative (PMC) Bank to 50,000 from the existing 40,000.
“The RBI, after reviewing the bank’s liquidity position and its ability to pay its depositors has decided to further enhance the limit for withdrawal to Rs 50,000, inclusive of Rs 40,000 allowed earlier,” the central bank said in a statement. With the above relaxation, more than 78 per cent of the depositors of the bank will be able to withdraw their entire account balance.
The RBI has also decided to allow the depositors to withdraw from the bank’s own ATMs within the prescribed limit of Rs 50,000. “This is expected to ease the process of withdrawals,” it added.
The RBI’s directive came after nine depositors of the scam-hit bank were detained today for protesting outside the RBI office in Mumbai’s Bandra Kurla Complex (BKC). The protesters gathered at the spot and started raising slogans demanding they be allowed to withdraw money from their accounts above the limit prescribed by the apex bank.
This is the fourth time the regulator has increased the withdrawal limit since it clamped down on PMC Bank and put curbs on withdrawals. On October 13, the RBI increased the withdrawal limit to 40,000 from 25,000 earlier. On October 3, the RBI had increased the cash withdrwal limit to Rs 25,000 from Rs 10,000. While slapping restrictions on the bank for six months on September 24, the RBI had allowed withdrawal of only Rs 1,000, creating panic among the depositors.
On September 26, following a spate of complaints from the depositors, the RBI relaxed the curbs and capped withdrawal at Rs 10,000 of the total balance held in every savings bank account or current account or any other deposit account.
The bank was put under “directions” by the RBI in September this year due to weak financial health over its exposure to near-bankrupt realty player HDIL, to which it has loaned over 70 per cent of its Rs 9,000 crore in advances.
Five persons, including HDIL promoters and bank’s top management, have been arrested. The Enforcement Directorate too is investigating the case and has attached the assets of HDIL promoters, Rakesh Wadhawan and his son Sarang Wadhawan, who are in its custody. At least nine depositors have died since the alleged scam came to light.
(Inputs from PTI)