Failed Visnagar Bank depositors to get back their money

DICGC disburses Rs 135 crore

After a long wait depositors of the liquidated Visnagar Nagarik Sahakari Bank will get back their insured deposits.

The Deposit Insurance Credit Guarantee Corporation (DICGC) has disbursed the first installment of Rs 135 crore of insured deposits to the bank, which will now start disbursing this among depositors.

While a claim of Rs 400 crore had been made with the DICGC, it has passed a claim of Rs 339 crore, which will be released to the bank liquidator over the next couple of months. To begin with, the bank will start paying off to depositors having small amounts with the bank.

Visnagar Nagarik Sahakari Bank went weak in 2002 after which Prafful Harshe was appointed as custodian of the bank following its suspension from the clearing house.

Harshe was appointed custodian on August 11, 2002, and the bank was liquidated on July 11, 2003. The claims with the DICGC were filed on November 10, 2003.

Visnagar Bank has a total of 2.76 lakh depositors, of which only 1,800 have deposits of over Rs one lakh.

With the DICGC having disbursed the insured sum, almost all the depositors of Visnagar Nagarik Sahakari Bank will get their entire deposit back, although after a long wait.

The remaining 1,800 depositors who have deposits in excess of Rs one lakh will however, get up to Rs one lakh back, as these deposits are insured with the DICGC.

"Yes, I have received the first installment of Rs 135 crore from the DICGC and will begin repaying depositors back. Ever since I have been appointed custodian, I have received excellent support from the depositors and other agencies. It is indeed a happy day for Visnagar depositors," said Prafful Harshe.

"There is some compliances that I will require to be completed before the remaining amount is also disbursed. The total insurance claim should be disbursed within the next two months," Harshe said.

Atul Brahmbhatt, president of Visnagar Bank Depositors Association, said that after a long struggle, depositors of the bank will begin getting their money.

"We have had to make several representations to the state government and the DICGC before the disbursal has actually been possible," Brahmbhatt said.