Fresh norms for new UCBs soon

Written by fe Bureau | Mumbai | Updated: Oct 26 2011, 08:32am hrs
The RBI will soon issue fresh norms for setting up new urban co-operative banks (UCBs).

Earlier an expert committee, under the chairmanship of YH Malegam, was constituted with representations from all stakeholders for studying the advisability of granting licences for setting up new UCBs.

The committee was also mandated to look into the feasibility of an umbrella organisation for the UCB sector. The major recommendations of the committee, which submitted its report in August 2011, included: minimum entry point capital norms ranging between R50 lakh and R500 lakh, depending upon the location and area of operation; preference to existing co-operative credit societies with a sound track record for grant of licence; every new UCB to have a board of management (BoM) to be appointed by the board of directors (BoD) and a chief executive officer (CEO) to be appointed by the BoM.