THIRUVANANTHAPURAM : Following the state cabinet approval on Tuesday, the govt will ask the Governor to issue ordinance for amalgamation of Malappuram Co-op Bank. The latest ordinance will include amendments to facilitate the bank’s merger with state-owned Kerala Bank.
Of the 14 district cooperative banks (DCB) scheduled to merge with the Kerala State Cooperative Bank, only Malappuram Co-op Bank stands adamant to stay out. The situation drew widespread criticism, given the longstanding merger demands raised by the district’s Primary Agricultural Cooperative Societies, Urban Cooperative Bank and employees from the District banks.
The government received a number complaints from customers of Malappuram cooperative banks stating non-availability of value-added services provided by the Kerala Bank, prompting the state to hold talks with the RBI and bring about suitable ordinance in the matter.
Can't Afford To Stand Alone
The 2019 Amendment to the Kerala Co-operative Societies Act, had scrapped the then upper tier namely the District Co-operative Bank status. Hence the Malappuram District Cooperative Bank cannot exits as a sole remnant. Besides, huge transformation in the banking sector, amendments to banking laws, enormous costs involved in providing modern banking facilities and rising NPAs(non-performing assets) renders it impossible to continue as a line entity.
