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Last Updated : Sep 24, 2019 09:05 PM IST | Source: PTI

Panic grips pockets of Mumbai megapolis as PMC Bank goes 'belly up'

The scene outside the PMC headquarters at the eastern suburb of Bhandup did not betray the fear among the tens of hundreds of depositors who rushed in, on hearing the news of their bank 'going belly up'.


A wave of panic and grief struck some pockets of the financial capital-home to the toniest of the domestic and foreign banks-where the urban cooperative bank PMC, which has been placed under RBI restrictions for regulatory lapses Tuesday, has branches.

The development comes amidst the growing gloom among the public who are already battling a deepening slowdown which has resulted in job losses and many other hardships.

Citing many irregularities, including under reporting of bad loans numbers which are said to be high double-digits, the Reserve Bank early Tuesday imposed a slew of restrictions on Punjab & Maharashtra Cooperative Bank (PMC) for six months.


The main curbs include banning PMC from extend new loans and capping cash withdrawals at Rs 1,000 per customer among others. The RBI did not specify the lapses, though.

The scene outside the PMC headquarters at the eastern suburb of Bhandup did not betray the fear among the tens of hundreds of depositors who rushed in, on hearing the news of their bank 'going belly up'.

The panic grew despite the fact the RBI has clearly said that its actions against the bank should not be construed as cancellation of its banking licence.

Those who rushed into the branches speak for itself the profile of PMC customers--autorickshaw drivers, small-time businessmen, pensioners and homemakers and the elderly-and all are united in their worries-- the security of their hard- earned money.

Outside the headquarters, this reporter could find an autorickshaw driver anxious about his Rs 10,000 in deposit with the bank; a small-time businessman with an EMI of Rs 60,000 going out from the PMC account, and a homemaker who probably has no other bank account.

As the number of panicked customers began to swell and tempers began to fray, the bank took safety in police protection both for its headquarters as well as at its branches to deal with any untoward incident.

At the headquarters, harried customers were queuing up to withdraw the meager Rs 1,000 allowed by the regulator, but uncertain of tomorrow.

"I withdrew Rs 1,000 from the account. The bank is saying that now I can withdraw money only after six months," said an elderly woman who came out of the headquarters gasping and clutching the two Rs 500 bills in her frail hand.

As soon as she came out, many anxious customers awaiting their turn thronged her.

A septuagenarian waiting for her turn averred that on one hand the government encourages us to put our money in bank accounts but incidents like these shakes our confidence in the banking system.

"Mein aaj hoon, kal ka kya bharosa hai (I am alive today, who knows what will happen to me tomorrow," she said with teary eyes.

Many customers are also worried about their EMIs that are due to be deducted from their accounts with PMC.

"Mere paas Rs 60,000 ka EMI hai jo iss account se kata hain. Agar allow nahi kara toh mera Cibil score kharab ho jayega (I have an EMI of RS 60,000 which get deducted from my PMC account. If it is not deducted, my Cibil score will be spoiled," averred a harried shop-owner.

A shattered small-time businessman, having a shop near the bank's headquarters, said he withdrew money Monday from his current account but is shocked to learn that the bank is not lending any more now.

"This is the time to give bonuses to my employees. I don't know how I am going to pay them now," the upset businessman said.

With the news spreading like wild fire, it is not difficult for one to locate a PMC branch in the hurly burly of the megapolis.

"Sir, woh bank toh bandh ho gaya. Wahan jaa kar aap kya karenge. (Sir, that bank is closed. What will you do going there)," an onlooker told this reporter, directing me to head northwards towards the PMC branch at Sion, central suburb.

The branch located in the down-market bears the same look as the headquarters but the customers are not allowed to withdraw money here.

"Main branch se saheb aane wale hai 20 minute mein, uske baad aap log paise nikal sakte hai," a bank employee, who was surrounded by customers, said.

Anticipating unruly behavior from harried customers the branch got police deployed.

"Mere 10,000 rupaye bank mein hai. Nahi maloom ab kya hoga mera (I have Rs 10,000 in my account. I don't know what will happen)," an auto-rickshaw driver said.

PMC customers are bracing themselves for a tough time, maybe similar to the one they witnessed during demonetisation.
First Published on Sep 24, 2019 09:00 pm