It wasn't even a fraud, RBI decision harsh: Suspended PMC MD Joy Thomas – Economic Times, The Times of India

The suspended managing director of Punjab & Maharashtra Cooperative (PMC) Bank,Joy Thomastoday claimed that theRBI‘s decision to put restrictions on withdrawals was harsh and has ty that harmed the organization.

In a press conference, he claimed that the NPAs were undisclosed for last 6-7 years and that they have voluntarily reported these to the central bank .

Loans granted by the bank were not reported due to classification issues, he claimed and added that the bank had sought time to correct books of accounts.

TheHDILloans, he said were backed by secutiries and other assets.

The RBI order, he added, created a shock in the market and that there are lots of confustion and rumors in the market now.

Thomas insisted that there was no fraud done in thePMC bankand termed the whole issue as “technical in nature”.

RBI could have managed better without harming depositors, he added.

The RBI on Tuesday had barred the PMC Bank from carrying out almost all its routine banking activities for six months. Initially, it had allowed depositors to withdraw only Rs 1000 from any of their accounts. Today, RBI increased the amount to Rs 10, 000.

As per reports, PMC failed to report NPA of Rs 2, 500 crore of HDIL and even went on to grant a personal loan of Rs 96 crore. HDIL reportedly used these amounts to pay off the Bank of India (BoI), which had initiated bankruptcy proceedings against the firm for allegedly defaulting on loans of around Rs 520 crore.