Letter to BS: Keeping PMC Bank crisis in mind, don't let Kerala Bank fail

In all probability, it will be the biggest cooperative bank in India and soon get categorised under the "too big to fail" category

Since the beginning of the last century when the cooperative movement emerged in India, cooperative banks have played a proactive role in the economic development and social life of Kerala. Attempts by vested interests to capture and manage cooperative institutions and efforts to circumvent regulatory and supervisory requirements did affect the growth of this ideal institutional system, off and on. The problems faced by cooperative banks during demonetisation (2016) and the recent failure of the Punjab and Maharashtra Co-operative (PMC) Bank can be traced to such intervention by external forces.

The conditions relating to capital adequacy, management and institutional set-up