RBI appoints former Union Bank executive as PMC Bank administrator

The Reserve Bank of India (RBI) on Tuesday appointed former Union Bank of India executive A K Dixit as the administrator of Punjab and Maharashtra Cooperative (PMC) Bank. J B Bhoria stepped down from the administrator’s position “due to health reasons” exactly a year since he took charge, the RBI said. The central bank said that huge losses incurred by the bank and a steep decline in deposits pose serious challenges for PMC Bank’s revival.

“While the Administrator of PMC bank and the RBI have been exploring various options for resolution of the bank, several factors such as huge losses incurred by the bank resulting in its entire net worth getting wiped out, steep erosion in deposits, etc. continue to pose serious challenges in finding a workable plan for revival of the bank,” the RBI said.

The bank has also been making efforts for recovery of non performing assets (NPAs), the RBI said, although the progress has been constrained because of the Covid-19 pandemic and legal complexities. “Nevertheless, in the interest of the depositors, the PMC bank and the RBI are continuing to engage with the stakeholders to explore the possibility of finding a viable and workable solution for the resolution of the bank,” the regulator said.

PMC Bank was placed under the RBI-appointed administrator’s charge with effect from close of business on September 23, 2019. The directions which superseded the board are presently valid till December 22, 2020.