Baripada: Baripada Urban Cooperative Bank (BUCB) in Mayurbhnaj district has finally started repaying deposits to its customers and initiated process to recover loans worth Rs 130 crore from defaulters, a report said.
The bank said, 90 percent of the customers have received their funds by furnishing necessary documents. It may be noted here that the licence of BUCB had been cancelled by the Reserve Bank of India (RBI) in 2014 as its NPA grew exponentially.
The bank had gone bankrupt and was not in a position to refund over Rs 68 crore to the depositors. Loans amounting to over Rs 130 crore are pending with over 35,000 loanees. In the initial phase, 437 customers have been paid Rs 7.07 crore. Till date, Rs 71.62 crore has been paid to its customers.
Bank sources said that notices will be issued to 4500 people who have defaulted loans worth Rs 130 crore.
In the initial phase, Rs 83.04 crore will be recovered from 20 defaulters. If the defaulters fail to clear their dues, their immovable properties will be confiscated and auctioned, said Amarendra Kar, chief manager of BUCB.
According to sources, over 72,000 depositors had kept money in the bank. Baripada cooperative bank was told to return depositors’ money after RBI had cancelled the licence after a statutory inspection revealed that the bank was in deep red, ceased to be solvent and any chance of its revival was next to impossible.
In June, 2020, the High Court had directed the management in-charge of Baripada Urban Cooperative Bank to disburse the money of its depositors.
The order had brought a ray of hope for 72,324 depositors, who have been left high and dry since the RBI cancelled the bank’s licence October 16, 2014.
The bank had filed an interlocutory application (IA) seeking the Court’s direction for refund of money to the depositors during pendency of its main petition challenging the Centre’s order rejecting its appeal against the RBI direction.
A single judge bench had issued the order after considering the acute financial plights of the depositors in the wake of Covid-19 pandemic along with submissions made on behalf of RBI and the state government.
RBI counsel DN Mishra had submitted that after the cancellation of licence of the bank, it is the responsibility of the liquidator/management in-charge to look into the grievances of depositors.
The Registrar of Cooperative Societies (RCS) directed the Deputy Registrar of Cooperative Societies (DRCS) Baripada to ensure strict execution of order of the Orissa High Court in this regard which had directed the liquidator in September last year to disburse the money within next eight weeks.
The cooperative bank was set up in 1960. It was operating in Baripada with three branches at Udala, Karanjia and Rairangpur areas in Mayurbhanj district. A large number of customers of the bank had moved the High Court seeking refund of their deposits from the bank.
PNN