INSUBCONTINENT EXCLUSIVE:
Mumbai: The central has given its nod for an umbrella unit to strengthen urban cooperative banks (UCB)
The proposed entity is expected to provide liquidity support to UCBs, besides providing IT infra
an umbrella organisation for the sector, which can provide liquidity and capital support to member banks, the RBI has given approval for its
countries that provide access to resources/capital to financial co-operatives at the base level through their ability to tap into the
capital market, while maintaining the cooperative character, RBI said.
The apex central body also provides services to its member banks and
regulates their activities
UCBs cannot raise capital through public issues, limiting their ability to comply with the regulatory requirements.
UCBs caught media
attention in September earlier this year when RBI put curbs on Punjab and Maharashtra Co-operative (PMC) Bank for under-reporting bad loans
and concentrated exposure to a realestate company
Umbrella organisations can also exist as a distinct entity where the credit unions are its members