Millennium Post

Withdraw RBI's supervisory role of Bengal cooperative banks: CM urges PM

Withdraw RBIs supervisory role of Bengal cooperative banks: CM urges PM

Kolkata: Chief Minister Mamata Banerjee on Tuesday expressed dissatisfaction over the Centre's move to transfer the supervisory role of state cooperative banks to the Reserve Bank of India, contending that it was against the spirit of cooperative federalism.

The RBI was thus far overseeing the banks' capital adequacy, risk control and lending norms, while management responsibilities were entrusted to the Registrar of Cooperative Societies of the state government.

"The Centre through The Banking Regulation (Amendment) Ordinance 2020 on June 26 has unilaterally decided to bring urban cooperative banks and multi-state cooperative banks under the supervisory power of RBI," Banerjee stated in her letter adding that the move is against the spirit of cooperative federalism.

She further stated: "The Ordinance seek amend concerned section of the Banking Regulation Act, 1949 to confer the power of suppression of Board of Directors of a Co-operative society for a period not exceeding five years... Presently, this power of superseding the Board of Directors is exercised by the Registrar of Co-operative Societies of the state. Now with the promulgation of the Ordinance, this power has been given to RBI that is a clear infringement of the power of the State Government with regards to superintendence and control of the Urban co-operative banks."

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