NEW DELHI: The Union Cabinet on Wednesday cleared amendments to the Banking Regulation Act to strengthen the regulation of co-operative banks after the massive fraud at PMC Bank, which went unnoticed and exposed several gaps in the legal framework.
The proposed law seeks to enforce banking regulation guidelines of the RBI in co-operative banks, while administrative issues will still be guided by the Registrar of Co-operative, information and broadcasting minister Prakash Javadekar said, briefing media about the Cabinet decisions.
Observing that the changes will help strengthen financial stability, he said qualifications would be set for appointing CEO of co-operative banks and the RBI’s permission would be sought before appointment, as followed in case of commercial banks.
Audit would be as according to RBI guidelines and the central bank can also supersede the board if any co-operative bank is under stress, he said. Cooperative banks will be given time to comply with RBI guidelines in a phased manner, he added.
Officials said primary co-operative societies will not be governed by the amendments.
The proposed law seeks to enforce banking regulation guidelines of the RBI in co-operative banks, while administrative issues will still be guided by the Registrar of Co-operative, information and broadcasting minister Prakash Javadekar said, briefing media about the Cabinet decisions.
Observing that the changes will help strengthen financial stability, he said qualifications would be set for appointing CEO of co-operative banks and the RBI’s permission would be sought before appointment, as followed in case of commercial banks.
Audit would be as according to RBI guidelines and the central bank can also supersede the board if any co-operative bank is under stress, he said. Cooperative banks will be given time to comply with RBI guidelines in a phased manner, he added.
Officials said primary co-operative societies will not be governed by the amendments.
Download The Times of India News App for Latest Business News.
more from times of india business
Business News
LATEST VIDEOS
More from TOI
Navbharat Times
Featured Today in Travel
Quick Links
ELSS Mutual Funds BenefitsIncome Tax Refund statusWhat is AssochamITR Filing Last DateHome Loan EMI TipsHome Loan Repayment TipsPradhan Mantri Awas YojanaTop UP Loan FeaturesIncrease Home Loan EligibilityHome Loan on PFTax Saving Fixed DepositLink Aadhaar with ITRAtal Pension YojanaNita AmbaniIndian EconomyRBIAadhaar CardSBIReliance CommunicationsMukesh AmbaniIndian Bank Ifsc codeIDBI Ifsc codeIndusind ifsc codeYes Bank Ifsc CodeVijay Bank Ifsc codeSyndicate bank Ifsc CodePNB Ifsc codeOBC Ifsc codeKarur vysya bank ifscIOB Ifsc codeICICI Ifsc codeHDFC Bank ifsc codeCanara Bank Ifsc codeBank of baroda ifscBank of America IFSC CodeBOM IFSC CodeAndhra Bank IFSC CodeAxis Bank Ifsc CodeSBI IFSC CodeGST
Get the app