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On an application by the Reserve
Bank of India, the Central Government has today issued an Order of Moratorium
in respect of the United Western Bank Ltd. The Order of Moratorium has been
passed by the Central Government in public interest, in the interest of depositors
and the banking system.
The moratorium will be effective
from 14.00 hrs. on Saturday, September 2, 2006 up to and inclusive of December
1, 2006 or an earlier date, if alternate arrangements are put in place. During
this period, the Reserve Bank of India will consider various options, including
amalgamation of United Western Bank Ltd. with any other bank and finalise the
plans in public interest and with a view to ensuring that the public deposits
are protected.
During the period of moratorium,
the bank will be permitted to make only those payments that have been specified
in the Order of Moratorium and the depositors of the United Western Bank Ltd.
will be permitted to withdraw, in total, up to Rs.10,000 (Rs. ten thousand only)
from their savings bank account or current account or any other deposit account
through any of the branches of the bank. For the present, customers of the bank
will not be able to withdraw money through the ATMs of the bank/ATMs shared
with other banks so as to give effect to the monetary ceiling prescribed in
the moratorium. The customers, however, will be able to withdraw money up to
Rs. 10,000, that is, the limit specified, at any of the bank’s branches.
Established in 1936, The United
Western Bank Ltd., has its headquarters at Satara, Maharashtra. The bank has
a network of 230 branches, 12 Extension Counters and 75 ATMs and its operations
are mainly concentrated in Maharashatra. It is listed on Bombay Stock Exchange.
As on March 31, 2006, the bank’s deposits were at Rs. 6480.19 crore and advances
were Rs. 4006.27 crore. The bank incurred net losses of Rs. 98.64 crore and
Rs. 106.48 crore during the years 2004-05 and 2005-06, respectively. Its net
non-performing assets were 5.66% as on March 31, 2006 as compared to the peer
group figure of 1.97%. The bank's assessed Capital to Risk Weighted Asset Ratio
(CRAR) turned negative at (-) 0.3% as on June 30, 2006. This has jeopardised
depositors’ interest. The bank was also unable to come up with any credible
plan to raise fresh capital to bring its CRAR to the prescribed level.
The Reserve Bank of India has set
up help lines at Mumbai to assist the members of public. They may contact the
following officials of Reserve Bank of India.
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Shri M.K.Samantray
General Manager
Department of Banking Operations & Development
Reserve Bank of India
Centre I, World Trade Centre(5th Floor)
Mumbai 400 005
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Tel. No.(O) 022 22189553
(R) 022 28245344
Fax : 022 22160970
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Shri Ashok Joshi
Deputy General Manager
4Department of Banking Operations & Development
Reserve Bank of IndiaCentre I, World Trade Centre(5th Floor)
Mumbai 400 005
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Tel. No.(O) 022 22180343
(R) 022 24360107
Fax : 022 22160970
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Alpana Killawala
Chief General Manager
Press Release:2006-2007/323
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