Nirmala Sitharaman Assures PMC Bank Clients, Says Will Talk To RBI Chief

Nirmala Sitharaman met a group of angry customers of PMC Bank at the BJP office Mumbai.

PMC Bank Crisis: Nirmala Sitharaman said she will speak to the RBI chief.


  • Nirmala Sitharaman met a group of angry customers of PMC Bank
  • Customers protested outside Mumbai BJP office, her press conference venue
  • Will talk to RBI chief on distress of PMC Bank clients: Finance Minister

Finance Minister Nirmala Sitharaman said she will speak with the RBI Governor this evening over the distress of depositors of Punjab Maharashtra Co-operative (PMC) Bank. She met a group of angry customers of the cooperative bank in Mumbai this afternoon just before addressing a press conference.

Several customers were protesting outside the BJP office, the venue of her press conference.

"I will once again talk to the Governor of Reserve Bank this evening to convey the distress of PMC clients," Ms Sitharaman. "I've asked the secretaries of the ministry to study in detail as to what is happening. Representatives of the RBI will also be there to understand shortcomings, what happened and also to therefore, if necessary, look at the ways in which the respective acts will have to be amended," the Finance Minister added.

"The Ministry of Finance may have nothing to do with it directly because RBI is the regulator but from my side, I've asked the secretary of my ministry to work together with the Rural and Urban Development Ministry," she said.

On Wednesday, PMC customers, who have argued that the revised Rs. 25,000 limit on withdrawals imposed by the Reserve Bank of India (RBI) is still too little, protested outside a Mumbai court. Carrying placards that read "No Bail, Only Jail", they accused the RBI of not taking strict action against the erring officials and appealed to Prime Minister Narendra Modi to intervene in the matter.

Last week Rakesh and Sarang Wadhwan, the promoters of the crisis-hit real estate firm HDIL, were arrested by the Economic Offences Wing of Mumbai Police after their firm set off a crisis at PMC Bank by defaulting on loans worth Rs. 4,355 crore.

Enforcement Directorate filed a money-laundering case against the Wadhwan brothers and carried out raids at six places in Mumbai, including the HDIL office in Bandra (East) and the Wadhwan residence in Bandra (West).

The PMC case has sparked renewed concerns about the health of India's troubled banking sector, which has been rocked by a multi-billion dollar fraud at a state-run lender, the collapse of a major infrastructure lender, bad loan issues at state-run banks and a liquidity squeeze that has hit shadow lenders.

The RBI has responded to allay fears over the crisis.

"There are rumours in some locations about certain banks including cooperative banks, resulting in anxiety among the depositors. RBI would like to assure the general public that Indian banking system is safe and stable and there is no need to panic on the basis of such rumours," the RBI said in a tweet on October 1.