The top management of Madhavpura Mercantile Co-operative Bank (MMCB) is planning to sell off its assets to repay Rs 99 crore it owes to 10,400 depositors and account holders.
The bank has a total amount of Rs. 212 crores, of which it cannot utilise Rs.134 crores as per Reserve Bank of India’s directive.
MMCB has filed a pitition in Bombay High Court to grant permission for sale of banks owned property. MMCB had around 26 branches in the Gujarat and Maharashtra, of which it owns 20 properties.
Recently MMCB moratorium has been extended by two months. During this period, the bank will have to solve all its financial problems, else it can be recommended for liquidation.
“This could go in favour of depositors like Ketan Parekh,” said Dhirubhai Chavada, chairman of MMCB. The bank is willing to use the surplus Rs 78 crore to clear a major portion of its debts.
Dhirubhai Chavda, claimed that the Central Registrar of Co-operatives and RBI wants to pay the entire surplus fund to RBI's subsidiary, Deposit Insurance and Credit Guarantee Corporation (DICGC). MMCB owes Rs 436 crore to the DICGC.
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The registrar of state governments also support Central registrar's demand that DICGC be given first preference in this matter, he added. The bank holds deposits of about 200 co-oprative banks.
“Ketan Parekh has paid about Rs. 329 crores so far. He yet to pay the principle amount of Rs. 579 crores and an interest amount at rate of 12 per cent which totals to about Rs. 668 crores,” according to Chavda.
Also, MMCB is yet to receive over Rs. 300 crores from several other parties in Mumbai, he added.