Current Affairs

RBI modified directions to PMC Bank

Current context: RBI reviewed and modified the directions put on Punjab and Maharashtra Cooperative (PMC) Bank Ltd, Mumbai.
RBI modified directions to PMC Bank 
  • The modified measures are taken with a view to reducing the hardship of the depositors and allowed the bank to perform these functions:
    • Depositors can withdraw a sum not exceeding 10,000 rupees of the total balance from Savings account/current account/deposit account.
    • More than 60% of the depositors will be able to withdraw their entire account balance.
  • The modifications of rules are done after police complaints were filed against the top officials of the PMC bank and Housing Development and Infrastructure Limited (HDIL) for allegedly looting 3,000 crore rupees of the depositors.
  • A written complaint was filed alleging that money of at least 9.12 lakh PMC Bank depositors was looted by its top management and real estate firm HDIL.
  • The PMC Bank was placed under All-Inclusive Directions of RBI due to:
    • major financial irregularities
    • failure of internal control and systems of the bank
    • wrong/under-reporting of its exposures under various off-site Surveillance reports to RBI
    • RBI had already suspended the Board of the bank and an Administrator has been appointed.

Question: 

Q.1 Choose the correct option in the context of powers of RBI?
a. RBI can limit the money that depositors can withdraw from a bank
b. It can suspend the Board of the Bank
c. It can appoint an administrator for the Bank
d. All of the above
RBI modified directions to PMC Bank RBI modified directions to PMC Bank Reviewed by Neha Verma on September 27, 2019 Rating: 5

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