Financial Daily from THE HINDU group of publications
Friday, Jan 11, 2002
Financial Daily from THE HINDU group of publications Friday, Jan 11, 2002 |
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Opinion
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Letters The Madhavpura saga
The reports of three more Gujarat-based co-operative banks tracing the path of Madhavpura Mercantile Co-operative Bank are really shocking. Again, the small depositors are in peril. Though the State government has put in place some urgent salvage mechanism, it is to be seen whether these banks can protect the interest of the depositors. It is evident that the co-operative sector's failure occurs mainly on account of foul play by directors or other office bearers. The RBI is reported to have admitted that one of the three banks was not maintaining the credit deposit ratio since November 2001 and was suspended from the clearinghouse. But the small depositors in this bank may not lose deposits, as the bank was paying the premia in respect of Depositors' Insurance and Credit Guarantee Corporation of India, which ensures refunds up to Rs 1 lakh. The co-operative sector should be free from politics, caste or any such influencing factors, and the directors and office-bearers elected for the purpose of administration should be free of corrupt practices. C. P. Velayudhan Nair
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