INSUBCONTINENT EXCLUSIVE:
RBI has issued norms for merging district cooperative banks with their state level entitiesThe Reserve Bank of India has said that it will
has been notified for the state cooperative banks and district central cooperative banks with effect from April 1, 2021
Amalgamation of such banks needs to be sanctioned by the Reserve Bank of India.The central bank has released the guidelines after a few
co-operative credit structure.As per the guidelines, RBI will consider proposals for amalgamation "when the state government of the state
support if required, projected business model with clear profitability and proposed governance model for the amalgamated bank.The scheme of
amalgamation has to be approved by the requisite majority of shareholders
Also, NABARD has to examine and recommend the proposal of the state government."The proposal for amalgamation of district central
will be a two-stage process," the guidelines said.In the first stage, an 'in-principle' approval will be accorded subject to fulfilment of
certain conditions, following which the processes for amalgamation may be initiated by all concerned.After completion of the first stage,
NABARD and RBI may be approached for final approval along with compliance report, as per the guidelines.The guidelines also said that if as
the state government should infuse sufficient capital in such lenders to ensure that the shareholders are allotted at least one share each.
