MoF nods to the merger of PMC bank with USFB with immediate effect

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  • By Taxmann
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  • Last Updated on 28 January, 2022

Ministry of Finance; nods to the merger of Punjab and Maharashtra Co-operative Bank Limited bank with Unity Small Finance Bank Limited with immediate effect; Centrum Group and Bharatpe

Notification No. G.S.R. 45(E), Dated: 25.01.2022

Ministry of Finance has sanctioned and notified the Scheme for the amalgamation of the Punjab and Maharashtra Co-operative Bank Limited (PMC) with Unity Small Finance Bank Limited (USFB). The scheme is effective from 25-01-2022. Provisions w.r.t. transfer of assets and liabilities and general effect; Closure of books of the transferor bank and preparation of balance sheet; Valuation of assets and determination of liabilities etc. are provided in the detailed scheme as sanctioned by MOF.

RBI on 24 September 2019 seized PMC Bank capped cash withdrawals and launched an investigation into its accounting delays. After Investigation RBI has come to a conclusion that the present position of PMC Bank Limited calls for the preparation of a scheme of amalgamation. The MOF approved the scheme of amalgamation on 25/01/2022.

USFB, a joint venture between Centrum Group and Bharatpe, has commenced operations as a small finance bank with effect from November 1, 2021.

The UFSB shall have the option of merging branches of PMC according to its convenience and may close down or shift the existing branches of the PMC, as per the extant instructions issued by the Reserve Bank.

MOF specified that the depositors whose deposits are insured under the Deposit Insurance and Credit Guarantee Corporation Act, 1961 will be eligible under this scheme.

Under the scheme of the arrangement, the eligible depositors will get an amount equal to the balance in their deposit accounts or ?5,00,000 (Rupees five lakh only), whichever is less, in accordance with the Deposit Insurance and Credit Guarantee Corporation rules of distribution of such amounts.

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