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Madhavpura Mercantile bank revival delayed

Our Bureau

AHMEDABAD, July 6

THE first step towards the revival of the collapsed Madhavpura Mercantile Co-operative Bank (MMCB), through the reconstitution of its board of directors, has been delayed further.

This has come about as the Deposit Credit Insurance Guarantee Corporation (DCIGC), which had agreed to pay Rs 464 crore, has now sought clarifications pertaining to the deployment of over Rs 40 crore by MMCB.

Talking to the reporters here today, Mr Amit Shah, Chairman of the Ahmedabad District Co-operative Bank (ADCB) and a member of the MMCB revival committee, said the DCGIC had raised queries on joint accounts worth over Rs 32 crore. It has also raised ques tions on some other accounts adding up to Rs 9 crore as addresses of these account-holders were not available in the bank records.

The DCIGC norm that the accounts should be held in a single name for the purpose of claiming the insurance cover had put the plight of the claims of joint account-holders in a quandary, Mr Shah said adding that in the case of the deposits without proper addresses, they may have to written off as rogue accounts.

Mr Shah also clarified that at no point was any request made to the milk co-operative sector to lend money for the revival of the co-operative banks. He was referring to media reports that quoted the Chairman of the National Dairy Development Board, Ms A mrita Patel, and the managing director of the Gujarat Co-operative Milk Marketing Federation (GCMMF) as having taken a strong stand against any of their member banks lending money towards the MMCB revival.

The 76-year-old ADCB, which had been in the red for the last six consecutive years, has returned a net profit of Rs 26.88 crore for the last fiscal mainly on account of the reallocation of about Rs 536 crore in various sectors. This amount had hitherto b een lying in fixed deposits in the State Bank of India, Mr Shah added.