As per a new report, financial services company Centrum Group and payments startup BharatPe have submitted a joint Expression of Interest (EOI) to the Reserve Bank of India (RBI) for the acquisition of Punjab and Maharashtra Cooperative (PMC) Bank which is reeling from recent revelations of scam. It is said that Centrum and BharatPe will hold equal stakes in this venture, if approved.
Also read - PMC Bank Depositors Hold A Hunger Strike In Mumbai; Demand RBI Intervention
A total of four companies are said to be in contention to take over PMC Bank. Sources cited by TOI said that Liberty House Group has also submitted an EOI to the RBI, while the identity of the remaining two companies is unknown at this point.
Meanwhile, the RBI has further extended the restrictions placed on PMC Bank until March 2021. The regulator is expected to go through the proposals during this period.
This acquisition could greatly enhance BharatPe’s standing in the lending business. According to a source, the company will use its tech know-how and combine it with the financial expertise of Centrum to run PMC as a small-scale finance bank.
Read - RBI Cancels License Of A Bank In Maharashtra; Over 99% Of The Depositors To Get Their Money Back
As per data provided in March 2020, PMC Bank had deposits of ₹10,727 crores, total advances of ₹4,473 crores, and gross non-performing assets (NPA) of ₹3,519 crores. Even though the bank had a share capital of ₹293 crores, it registered a net loss of ₹6,835 crores during the financial year that ended on March 2020. This was coupled with a negative net worth of ₹5,850 crores.
The interest in PMC Bank from investors is understandable given the fact that it has 137 branches in locations across Maharashtra including Mumbai. The bank fell out of favour after financial irregularities were found along with revelations of misrepresenting information about loans given to real estate developer HDIL.
Also read - PMC Bank Depositors Will Have To Pay Interest On Deposits Despite Having No Access To Their Money
Share
Tweet
