RBI to help co-op banks tide over crisis

A senior official of the Reserve Bank of India (RBI) said here on Wednesday that the apex bank would extend all possible steps to enable the co-operative banks tide over the present crisis.

While interacting with representatives of various co-operative, private, and public sector banks, at the Southern Gujarat Chamber of Commerce & Industry, on Wednesday, C D Shrinivasan, general manager, RBI, Ahmedabad, said: "The co-operative banking sector was first introduced in Gujarat. The entire co-operative banking sector of Gujarat, especially Surat, is passing through a turbulent phase. The RBI is naturally worried about this, but hopefully this phase will be over shortly. The weakest co-operative banks have collapsed, while weaker banks are struggling for survival. Those banks that survive this phase will emerge stronger."

"There are some co-operative banks in Surat which are in good shape. There are some other banks, which will just survive. There are some banks which are beyond redemption," he added.

Shrinivasan accepted that RBI too is to be blamed for the co-operative debacle. "Earlier we were probably not monitoring the co-operative banks so closely. But we have stepped up monitoring now, which will ensure that any irregularities will come to our notice very early. We hope that all the banks will look at this step of ours in a positive manner, and support us," he said.

Shrinivasan said with increasing competition, all banks would have to pull up their socks. "Earlier, public sector banks had a monopoly, but they have been forced to change with the arrival of private sector and foreign banks. The time is changing rapidly, and customers are being provided new services and facilities. The co-operative banks too will have to gear up and put that extra effort to match the pace of other banks, which will enable them provide cheerful, prompt and satisfactory services to the customer," he said.

"We want to make banking a level-playing field for everyone, be it public sector banks, co-operative banks, private banks or foreign banks. We assure that RBI is fair, and not partial towards any particular sector. We want every bank, that is fit enough, to survive," Shrinivasan added.