PMC Bank crisis: MD Joy Thomas suspended, says report

Punjab and Maharashtra Cooperative (PMC) Bank's Managing Director (MD) Joy Thomas has been suspended after an official appointed by the Reserve Bank of India (RBI) took control over the bank.

The suspension came into effect on September 25, a couple of days after the bank was put under directions by the RBI. The bank is now being supervised by JB Bhoria, who has been appointed by RBI.

Bhoria has been tasked with the inspection of bank’s books and take appropriate actions. Further modifications in directions will depend on the findings of the inspection.

The bank’s upcoming annual general meeting was also called off after the RBI administrator took control of the bank. It was scheduled to be held on September 28 in Mumbai.

PMC bank came under RBI scanner for irregularities in loans granted to real estate group Housing Development Infrastructure (HDIL), according to a senior official.

“They (RBI) have found some irregularities. There is some exposure to HDIL,” a senior bank official told Moneycontrol. He said the amount is not very high and that the issue can be resolved. “The inspection is on. We are very much hopeful,” the official said.

PMC bank is one of the 62 banks registered under Multi-State Co-operative Societies Act, 2002. It comes under the purview of Central Registrar due to the involvement of more than one state.

As per the norms, the Central Registrar can order winding up of the bank on the recommendation of the RBI. The multi-state cooperative bank has 137 branches, mostly located in Mumbai. There are 1,814 employees as in March.