Ministry of Agriculture signs MoU with RBI for Multi-State Urban Co-operative Banks
Ministry of Agriculture, Government of India and the Reserve Bank of India, on January 16, 2007, signed a Memorandum of Understanding (MoU) with regard to Multi State Urban Co-operative Banks in the country. Consequent upon this, a Central level Task Force on Multi State Urban Co-operative Banks (TAFCUB) has been constituted. The first meeting of the TAFCUB will be held shortly.
As part of its developmental role, the Reserve Bank would assess the training and computerisation needs of the Multi State Urban Co-operative Banks with the objective of upgrading their human resources skills and technological infrastructure so that they improve their operational efficiency, quality of management information systems and governance.
After the signing of MoU for Multi State UCBs, 1462 out of 1853 UCBs stand covered under the TAFCUB. In terms of deposits, these UCBs account for about 90 per cent of deposits of the sector. Earlier, MoUs have been signed with the Governments of nine States, viz., Gujarat, Andhra Pradesh, Karnataka, Madhya Pradesh, Rajasthan, Uttaranchal, Chattisgarh, Goa and Maharashtra.
As the urban co-operative banks are subject to dual control by the Reserve Bank and State Governments, RBI's vision document for urban co-operative banks in March 2005, envisaged the signing of Memorandum of Understanding between the State Governments and the Reserve Bank of India to put in place an arrangement through which there is a convergence on the approach and remedial actions required to be taken for facilitating the development of the sector.
Accordingly, the Reserve Bank approached the Central and State governments in states having a large presence of UCBs for signing the MoU as a precursor to constituting the TAFCUB for identifying the potentially viable urban co-operative banks and drawing up a time-bound action plan for their revival by setting specific monitorable milestones.
Nine States sign MOU with RBI for UCBs
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