Roll No SAP No Name

6 40311180005 Divya Bhargava

7 40311180129 Aakanksha Bhat
8 40311180006 Preeti Bhat
9 40311180009 Saptati Chattopadhyay
10 40311180150 Ronak Chaturvedi

Indian Financial System

SYBCOM- A (Special Batch]
Mithibai College
• PUNJAB & MAHARASHTRA CO-OPERATIVE BANK LIMITED also known
as PMC BANK, is a MULTI-STATE CO-OPERATIVE BANK that began operations
in 1983.
• It has 137 branches spread over half a dozen states of India and nearly 100 branches
are in Maharashtra.
• At the time of its establishment PMC was a co-operative bank but in 2000, It got the
status of SCHEDULED COMMERCIAL BANK by the Reserve Bank Of India. PMC
is the youngest bank to achieve the ‘scheduled bank’ status.
• It is one of the profitable co-operative banks in India and had earned a total revenue
of ₹1,297 crore (us$182 million) and profits of ₹99.69 crore (us$14 million) in the
financial year 2019.
• Its Customers include Small Businesses, Housing Societies and Institutions.
• The crisis at PMC bank first came to light on September 24, 2019, RBI placed curbs on
the activities of the bank for six months
• RBI also limited the amount a customer could withdraw from their account during the
next six months — to Rs 1,000 at first, and later to Rs 25,000.
• THE TOTAL AMOUNT OF THE BANK FRAUD THEN IT WAS RS 4,355 CR.
• Mr Waryam Singh got appointed as the chairman of PMC bank in
January 2015 for five years. It was, in fact, Singh’s second term as the
chairman of PMC bank. He had held the office previously from 1999
to 2005 and held 1.91 per cent stake in HDIL till 2017, which is a clear
violation of the law.
• PMC had replaced 44 loan accounts of the HDIL group with over
21,000 fictitious loan accounts.
• The now-suspended managing director of the crisis-hit PMC Bank,
Joy Thomas, has admitted to the RBI that the Bank’s actual exposure
to the bankrupt HDIL is over Rs 6,500 crore. It is four times the
regulatory cap or a whopping 73 per cent of its entire assets of Rs
8,880 crore.
• Auditors of the fraud hit PMC bank has issued a clean report for FY 2018-19. Statutory
auditors failed to highlight serious violations of RBI guidelines and underreporting of
amount doubtful of recovery since the amount suspicious of recovery was much more than
the amount reported in the auditor’s report.
• As per regulations, single entity exposure limit for banks is 15 per cent of their capital fund.
For group companies, the exposure limit is 20 per cent. Thus, PMC’s exposure to HDIL is
almost four-times of what RBI mandates. Thomas has also put the actual NPA number at 60-
70 per cent as against a reported net NPA of 2.19 per cent as of March 31, 2019.
• The Auditors of PMC bank will reportedly also be scrutinized as they did not classify loans
to HDIL as non-performing assets (NPA) as per RBI guidelines despite multiple payment
defaults on the company’s part.
• Over five PMC bank account
holders passed away due to
reasons including heart attack,
suicide, etc.
• According to a CNN-News18
flash, RBI officials met
a delegation of PMC depositors
who have been protesting at
Mumbai's Azad Maidan over
the central bank's strict
withdrawal limits that were
imposed on the bank.
• The Enforcement Directorate (ED) has sealed the assets of Rs 3,500 Cr of
the HDIL group and the HDIL chief Rakesh Wadhawan and his son Sarang
Wadhawan have been arrested by the Mumbai police.
• This bank fraud case is busted by a bunch of women employees of the
credit department of the PMC bank. These employees told to the RBI that
they were aware of the ghost accounts.
• The EOW(economic offences wing) arrested Rajneet Singh, the director of
PMC bank before the RBI put restrictions on the lender. He was also on the
recovery committee of the bank. The EOW had also arrested Jayesh
Sanghani and Ketan Lakdawala, the two auditors who did the statutory
audit of fraud-hit PMC Bank.
THANK YOU