The Hindu : Andhra Pradesh News : One-time settlement scheme for coop. banks opposed

Online edition of India's National Newspaper
Monday, Feb 21, 2005

Andhra Pradesh

Andhra Pradesh

One-time settlement scheme for coop. banks opposed

By Our Staff Reporter

HYDERABAD, FEB. 20. The Andhra Pradesh State Cooperative Urban Banks Federation Ltd on Sunday opposed the one-time settlement scheme implemented in the Vasavi, Prudential and Krishi banks. The general body of the federation felt that the scheme brought about a sense of insecurity among depositors and sent wrong signals to borrowers.

G. Ramamurthy, chairman, said the federation was opposed to auditing by the Reserve Bank of India (RBI) of cooperative urban banks, as professionals were not doing it. He urged the RBI to consider some relaxation of norms and allow five years for the acquiring banks to adjust to the new situation.

Amendment to Acts

He said 130 of the 169 cooperative urban banks in the State were now active and were expected to present good balance sheets by next month. Their NPAs had also come down.

The general body expressed the view that the three Acts governing the cooperative societies needed amendment, as they were "contrary to the spirit of merger envisaged in the RBI guidelines". It listed the Acts - Andhra Pradesh State Cooperative Societies Act, 1964, Mutually Aided Cooperative Societies Act, 1995 and Multi-State Cooperative Societies Act, 2002.

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Andhra Pradesh