United Western Bank placed under moratorium

Our Banking Bureau
02 September 2006

The moratorium will be effective from September 2 to December 1, 2006 or an earlier date, if alternate arrangements are put in place.

During this period, the Reserve Bank of India will consider various options, including amalgamation of United Western Bank Ltd with any other bank and finalise the plans in public interest and with a view to ensuring that the public deposits are protected.

The bank will be permitted to make only those payments that have been specified in the order of moratorium and the depositors of the bank will be permitted to withdraw, in total, up to Rs 10,000 (ten thousand rupees only) from their savings bank account or current account or any other deposit account through any of the branches of the bank.

For the present, customers of the bank will not be able to withdraw money through the ATMs of the bank /ATMs shared with other banks so as to give effect to the monetary ceiling prescribed in the moratorium.

The Satara-based United Western Bank has a network of 230 branches, 12 extension counters and 75 ATMs and its operations are mainly concentrated in Maharashatra. It is also listed on the Bombay Stock Exchange.

As of March 31, 2006, the bank's deposits stood at Rs 6,480.19 crore while advances were Rs 4006.27 crore. The bank incurred net losses of Rs 98.64 crore and Rs 106.48 crore during the years 2004-05 and 2005-06, respectively.