Modi govt gave relief to depositors of failed Cooperative Bank: Tejaswi Surya

South Bengaluru MP Tejaswi Surya on Monday said the disbursal of Rs 5 lakh deposit insurance to the depositors of the Sri Guru Raghavendra Cooperative Bank is a big reprieve provided by the Narendra Modi-led government.

South Bengaluru MP Tejaswi Surya on Monday said the disbursal of Rs 5 lakh deposit insurance to the depositors of the Sri Guru Raghavendra Cooperative Bank is a big reprieve provided by Prime Minister Narendra Modi-led government. Holding a press conference here in the national capital, Surya said, "A majority of the depositors are retired, senior citizens. The measures taken by the Union Government speaks volumes of the priority that the government has accorded to providing relief to the middle class."

Surya said, "15,012 claims from depositors that were worth around Rs 440 crore was paid by the Deposit Insurance and Credit Guarantee Corporation (DICGC). The balance claims of around 6,000 depositors will be processed this week." "As soon as the Modi government and the Finance Minister got to know about the crisis at the Sri Guru Raghavendra Bank, they took multiple steps to provide relief to the depositors who were at the verge of losing their hard-earned savings, as well as bring more professionalism in the cooperative banking sector," he added.

Surya further recalled that in 2020, the government raised the insurance cover for depositors from Rs 1 lakh to Rs 5 lakh. In the same year, on Sept 17, 2020, "the government passed amendments to the Banking Regulation Act, 1949, bringing all cooperative banks under the ambit of the Reserve Bank of India (RBI)." "Earlier this year, on August 9, the government amended the DICGC Act, 1961, and paved the way for depositors to receive Rs 5 lakh from the DICGC within 90 days of filing an application. The deposit insurance would also be provided even if there's a moratorium on the bank. This benefited 98.3 per cent of the depositors and 50.9 per cent of the deposit value in all banks," Surya said.

The RBI had imposed regulatory restrictions on the Sri Guru Raghavendra Cooperative Bank on January 10, 2020, after its fraud of presenting fake PL statements came to the fore. There are 41,804 depositors in Guru Raghavendra Bank and around 31,576 account holders have deposits up to Rs 5 lakh. The total deposits in the bank amounted to Rs 2403.21 crore, while the total advances or the number of loans given out by the bank was around Rs 1438.00 crore. The Gross NPA, however, stands at Rs. 1438.00 crore as of 31 March 2020. Around 27 borrowers have borrowed upwards of Rs 927 crore and have contributed to more than 70 per cent of the total NPAs in the bank.

"For the first time in India's history, depositors of failed cooperatives have gotten their deposit insurance in the shortest possible duration. The large disbursal exercise on Monday covered 16 stressed banks. The transfer of money for the remaining depositors will happen soon. The last date of submission of documents in the second phase is December 10, while the date of payment is December 31, 2021," Surya added. (ANI)

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