BHUBANESWAR: The Cooperation department has once again moved the state government seeking permission for refund of depositors’ money up to Rs one lakh out of the funds available with the liquidator of the now defunct Urban Cooperative Bank Limited, Bhubaneswar.
“The state government has been moved for allowing the Urban Cooperative Bank, Bhubaneswar for refund of money of Rs 15,16,59,365.17 to 6,446 depositors as approved by the Deposit Insurance and Credit Guarantee Corporation (DICGC) out of the own fund of the bank,” said a letter of the Registrar of Cooperative Societies to the department.
On liquidation, every depositor is entitled to repayment of his/her deposits up to a monetary ceiling of Rs one lakh from the DICGC under usual terms and conditions. This is the insurance cover per bank account irrespective of the amount of deposit.
As a total fund of Rs 13.55 crore is available with the liquidator creating a shortfall of over Rs 1.61 crore, the department has requested the government to grant permission for utilisation of its share capital for refund of the depositors’ money.
According to information available from the department, over Rs 33.87 crore of deposits of 11,672 account holders were locked in the bank which has been liquidated. While deposits amounting to Rs 29.67 crore of 7,700 depositors could be traced, another deposit of Rs 4.2 crore of 3,972 accounts is yet to be located.
The total loan outstanding against 1,546 depositors is more than Rs 42.77 crore while the bank could recover Rs 70.31 lakh since the date of liquidation.
These depositors have been waiting for more than 16 years to get back their money from the bank. The bank was granted a licence by the RBI on September 7, 1987 to conduct banking business. Statutory inspection of its financial position as on March 31, 2003 had reported deteriorating financial position. The bank had sanctioned loans to its directors and their relatives and all accounts became non-performing asset (NPA).
Though the government made several attempts for revival of the bank by infusing Rs six crore in 2006, it failed to change its fortune. The government even attempted a merger of this bank with the Cosmos Cooperative Bank of Pune, but this failed to materialise.