RBI grants Centrum time till 5 December to fulfil PMC Bank takeover conditions
05 July 2021
Reserve Bank of India (RBI) has extended the time allowed for Centrun Financial Services Ltd (CFSL) till 5 December for setting up a small finance bank as per its Letter of Intent for takeover and revival of Punjab and Maharashtra Co-operative Bank (PMC Bank), which is currently under RBI directions.
This has been done after taking into account the time required for completion of various activities involved in the process, RBI found it necessary to extend the directions.
In pursuance of CFSL’s offer dated 1 February 2021, in response to the EOI, RBI had, on 18 June 2021, granted “in-principle” approval, valid for 120 days, to CFSL to set up a small finance bank (SFB) under the general guidelines for ‘on tap’ licensing of small finance banks in the private sector.
Punjab and Maharashtra Cooperative (PMC) Bank Limited, a multi-state urban cooperative bank was placed under RBI directions as per provisions of the Banking Regulation Act, with effect from the close of business on 23 September 2019, in the interest of depositor protection. The directions were last extended on 26 March 2021 up to 30 June 2021.
In response to the EoI floated by PMC Bank on 3 November 2020, for its reconstruction, certain proposals were received. After careful consideration, the proposal from Centrum Financial Services Ltd. (CFSL) along with Resilient Innovation Pvt Ltd has been found to be prima facie feasible.
Accordingly, RBI had, on 18 June 2021, granted “in-principle” approval, valid for 120 days, to CFSL to set up a small finance bank (SFB) under the general guidelines for ‘on tap’ Licensing of Small Finance Banks in the Private Sector.
RBI said all other terms and conditions of the directives remain unchanged.