India's central bank approves takeover of fraud hit PMC Bank

India's central bank approves takeover of fraud hit PMC Bank

The Reserve Bank of India has given its in-principle approval to Centrum Financial Services Limited to take over the troubled Punjab and Maharashtra Co-operative Bank, it said in a statement on Friday.

FILE PHOTO: A man walks out from a Punjab and Maharashtra Co-operative Bank branch in Mumbai
FILE PHOTO: A man walks out from a PMC (Punjab and Maharashtra Co-operative) Bank branch in Mumbai, India, September 26, 2019. REUTERS/Francis Mascarenhas

MUMBAI: The Reserve Bank of India has given its in-principle approval to Centrum Financial Services Limited to take over the troubled Punjab and Maharashtra Co-operative Bank, it said in a statement on Friday.

Financial services firm Centrum will be allowed to set up a small finance bank (SFBs) with the PMC takeover.

SFBs are niche lenders introduced in the Indian banking system by the RBI that are meant to further financial inclusion.

In September 2019, the central bank had put curbs on the PMC bank after finding financial irregularities such as under-reporting of bad loans.

(Reporting by Nupur Anand; Editing by Alex Richardson)

Source: Reuters

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