BHUBANESWAR: With the employees of Central Cooperative Banks (CCBs) demanding revised salary as per the recommendation of 7th Pay Commission, the state government has set up a committee for each CCB to examine the financial position of banks before taking a call on the matter.
The Registrar of Cooperative Societies has directed Deputy Registrar of Cooperative Societies (DRCS) of nine district CCBs to examine the financial condition of banks functioning under their jurisdiction and submit a report to the government in light of the stipulations made by National Bank for Agriculture and Rural Development (Nabard).
“The implementation of 7th Pay Commission may be considered on the basis of capacity of the bank to pay, taking utmost care of protecting the interest of depositors and on adhering to various statutory requirements,” the Nabard had advised the state government.
After inspecting the banks, Nabard said profit and loss accounts and the balance sheets do not reflect the actual financial position of DCCBs due to evergreening of loan accounts and divergence of non-performing assets (NPA).
“The cash outgo should be justified by proper recognition of cash-based balance sheet for limited purpose of payment of 7th Pay Commission salary and the capacity to pay may be calculated on that basis,” Nabard said in a letter to the state government.
The payment of revised salary as per the recommendations of the pay panel is for government employees. Since DCCBs are banks, banking norms should be followed as is done in case of Regional Rural Banks (RRBs) or commercial banks.
The national bank recommended to the state government to consider the revised salary if DCCBs are doing business of more than Rs 1,000 crores. “The per employee business of less than Rs 10 crores may not be eligible for implementation of 7th Pay Commission as applicable to bank sector,” Nabard said.
It suggested to the state government to constitute a committee to go into details of DCCBs’ financial position before taking a decision on the issue. At present, 17 DCCBs are functioning under Odisha State Cooperative Bank.