MSC Bank to file petition challenging amendments to the Banking Regulation Act
MSC Bank to file petition challenging amendments to the Banking Regulation Act

Days after the state government formed a Task Force to prepare an action plan to oppose the Centre’s amendments to the Banking Regulation (Amendment) Act 2020, the apex bank Maharashtra State Cooperative Bank has decided to file a writ petition in the Bombay High Court against these amendments.

MSC Bank Chairman Vidyadhar Anaskar told the Free Press Journal that the bank will argue that those amendments were against the principles of democratic control and cooperation. It is an attempt to bring commercial banking culture into cooperative banking which is unacceptable.

‘’We accept all the regulations relating to banking matters in the amendments,’’ said Anaskar. However, the bank and other federations are against the appointment of additional directors which are not the members of the bank. This will be in contravention with the principle of democratic control which is the basic principle of cooperation.

Anaskar said they will also oppose the appointment of a paid chairman in the bank. ‘’In the present cooperative banking structure, the chairman and directors work as trustees of the bank. If the chairman gets a salary as a full-time employee of the bank, then it is against the cooperative principle,’’ he noted.

Meanwhile, MSC Bank has posted net profit of Rs 369 crore for 2020-21 while its net worth is at Rs 2,703 crore and its provision coverage ratio is 91%.

Anaskar said the bank’s total business was reported at Rs 43,603 crore with 5% increase in advances. Apart from providing refinance to the district central cooperative banks, the MSBC also lends loans to the urban cooperative banks.

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