The Reserve Bank on Tuesday imposed strict operational restrictions on Punjab and Maharashtra Co-operative Bank (PMC Bank) on Tuesday, September 24, resulting in chaos outside its branches in the financial capital. As per the RBI directions to PMC Bank, withdrawals have been capped at ₹1,000 per account and the bank is not allowed to make any fresh loans.
Republic TV caught up with disgruntled customers of the PMC Bank at the JTB Nagar branch in Mumbai. The scenes were chaotic at the bank with one customer adding that “I have been here since 9 am, I came here to break my FD and the bank officials have told me that the accounts have been frozen.” It is being reported that the Bank officials are not providing any clear information to the customers.
There is widespread panic and chaos and over 900 people have gathered at this branch alone. According to another customer, “The Bank officials are not helping. Without a notice being served a bank can not simply be shut down. The RBI has not made this decision overnight. Every bank receives three notices and it is on the fourth notice that the bank is shut down.”
The RBI monitors banks' health and issues such directions in case of concerns over the financial health of an institution. However, no reasons were specified by the central bank for its restrictions on PMC Bank. "The issue of the directions by the Reserve Bank should not, per se, be construed as a cancellation of its banking licence. The bank will continue to undertake banking business with restrictions till further notice/instructions," the RBI said in a notification.
The restrictions will be in force for six months, the RBI said. According to PMC Bank's website, the lender was awarded the scheduled status in 2000 and has a presence in multiple states. The bank could not be reached for comments immediately.
The PMC Bank has a network of 137 branches. It is amongst the top-10 Co-Operative Banks in the country. More details are set to come in as to why the RBI imposed such strict restrictions on the bank.