Sitharaman faces angry PMC depositors, evades giving any concrete assurance

Union Finance Minister Nirmala Sitharaman on Thursday faced angry depositors of the scam-hit PMC Bank in Mumbai, who shouted slogans upon her arrival at the local BJP office for a presser, demanding that their money be returned to them.

Irate depositors gathered outside the Bharatiya Janata Party (BJP) office in south Mumbai ahead of Sitharaman's press conference.

Sitharaman and a few of the depositors went inside and had a brief conversation.

"I heard them about their problems and explained to them that multi-state cooperative banks...are regulated by the RBI," she later said, adding that the government's role is limited.

But she assured that she will speak to RBI Governor Shaktikanta Das and convey the "urgency and distress" of the depositors.

When asked when the depositors can get their money back, she said it was a process-driven exercise between RBI and the bank administrator appointed by the RBI.

Harbans Singh, a bank customer, told reporters that the depositors had expected the Union Finance Minister to give an assurance that their money was safe, but they were disappointed.

"Sixteen lakh depositors are in distress. What is our fault? You have got Rs 4,000 crore assets. Sell it and start the bank and then go ahead with whatever action you want against the accused," he said.

After a Rs 4,500-crore scam came to light at Punjab & Maharashtra Cooperative Bank, the Reserve Bank, which put curbs on withdrawal of funds from the bank, had also said that it would examine if the regulatory framework needed tweaks.

Sitharaman said a committee of secretaries of Economic Affairs and Financial Services, Rural Affairs and Urban Development ministries and a deputy governor of the RBI would be formed.

Through this committee the government intends to "understand and take necessary legislative steps to prevent such things from happening in the future, empower the regulator better", she said.

Stating that she is not presuming that there are shortcomings in the present laws, the minister said the panel will study the issue and "if necessary, in the forthcoming winter session of Parliament itself, we will be bringing in any amendments which may be necessitated".

After the scam came to light last month, the RBI capped withdrawals from the bank at Rs 1,000 over six months, but later increased it to Rs 10,000 and then to Rs 25,000 following angry protests by depositors.

The bank had allegedly lent over 70 per cent of its Rs 9,000 crore in loans to near-bankrupt realty player HDIL.