Gujarat-based Madhavpura Mercantile Co-operative Bank (MMCB) has announced its final settlement scheme 2016 in a bid recover dues from defaulters
Gujarat-based Madhavpura Mercantile Co-operative Bank (MMCB) has announced its final settlement scheme 2016 in a bid recover dues from defaulters. The bank hopes to recover about Rs 240 crore from nearly 600 borrowers through this scheme.
It may be recalled that thousands of small depositors got duped in the Rs 1,200-crore MMCB scam that was unearthed in 2001. A bank official, requesting anonymity, said MMCB, currently under liquidation, owes nearly Rs 100 crore to about 13,000 small depositors, and Rs 650 crore to 268 other co-operative banks.
With this scheme, MMCB is offering its borrowers the final opportunity to settle their dues. In a press note, the bank said the scheme will cover all accounts except those of Ketan Parekh, Mukesh Babu and Sirish Maniar of Maniar Group.
Chief executive officer GK Fakir said the bank had filed several civil as well as criminal complaints against “defaulter borrowers”. He hoped the final settlement would see most borrowers clearing their dues.
At a time when the Reserve Bank of India did not allow banks to lend more than Rs 15 crore to stock brokers, MMCB had fraudulently issued pay orders worth Rs 12 crore to Mumbai-based stock broker Parekh, and huge sums to Babu and Maniar.
In 2012, the RBI had cancelled the bank’s licence after its total recovery pending stood at over R1,100 crore and non-performing assets had touched 99.9% of total deposits.