Depositors seek details about revival of NICB

Mumbai: The depositors of the New India Co-Operative Bank (NICB) Ltd have shot off a letter to the Reserve Bank of India (RBI) seeking a clear timeline of the revival of the crisis-ridden bank.

The NICB Depositors' Foundation has written to RBI Governor Sanjay Malhotra seeking to know details and explained their plight. “Our faith in the banking system and regulatory authorities depends on your response. This issue is not just about financial loss, but about the livelihoods, security, and dignity of thousands of families,” NICB Depositors’ Foundation President TN Raghunatha, Joint President Rajani Pitale Kadam and Secretary Vivek Gaonkar said in the letter to the RBI chief. 

“Through no fault of our own, we now find ourselves in a dire financial situation. We are unable to access our hard-earned savings, which we have accumulated over decades, to meet essential life needs such as our children's education, medical expenses, old age security, personal activities, and even wedding preparations. Additionally, hundreds of co-operative housing societies across Mumbai and the neighboring Thane district, which have invested funds from their members in NICB Ltd., are also severely affected by this action,” the letter said.

NICB Depositors' Foundation

"We fail to understand how a mere Rs 5 lakh insurance coverage can justify the loss of our life savings….At a first glance, a Rs 122 crore fraud alone should not have been enough to destabilize a bank with a deposit base of Rs 2,436 crore as of March 2024. In the aftermath of the RBI’s intervention, the insurance payouts initiated by the bank—rather than efforts to revive normal operations—indicate deeper systemic issues. There may be undisclosed problems such as significant bad loans, mismanagement, or even more extensive frauds yet to be uncovered,” the depositors body said. 

“Now that nearly a month has passed since the imposition of restrictions, we believe that the RBI must have completed an audit of the NICB Ltd accounts and assessed the extent of the losses caused by the alleged fraud and other irregularities. As the apex bank, we have full faith and trust in your ability to secure our financial interests,” the depositors body told the apex bank.