Urban cooperative banks to get umbrella body for liquidity support

The organisation, an NBFC, will have authorised capital of Rs 500 crore

Urban cooperative banks (UCBs) are expected to have an umbrella organisation for liquidity support and self-regulation, by the end of this financial year.

While there has been talk of having such an organisation for some time, the recent fraud at Punjab and Maharashtra Cooperative (PMC) Bank has given the matter a move on.

The fraud, estimated at close to Rs 4,355 crore, has put depositors in uncertainty. 

“One of the objectives of the organisation would be to provide liquidity to banks in crisis situations,” said Subhash Gupta, member secretary and chief executive, National Federation of Urban Cooperative Banks and Credit