The Kerala government's long-pending dream of setting up its own bank, by merging the district co-operative banks, was set to become a reality with the High Court dismissing a batch of petitions filed against it.
Minister for Cooperation Kadakampally Surendran said the setting up of the bank opens up a huge potential for the development of the state.
"I believe this indeed is a revolutionary step and will change the face of the banking sector in Kerala. Kerala Bank - as the name suggests, it is Kerala's own Bank," Surendran tweeted.
The court granted permission to the Kerala bank after evaluating that its intervention in the merger procedures was not needed.
According to government sources, 13 district co-operative banks (DCBs) would be merged with the Kerala State Co-operative Bank for forming the proposed Kerala Bank.
All the DCBs, except the one in Malappuram district controlled by the opposition Congress-led UDF, had approved the Left government's proposal of amalgamation in their respective general body meetings.
Surendran had told reporters that the notification for setting up the bank was issued in the evening itself and administrator governance in the district cooperative banks would come to an end. Chief Minister Pinarayi Vijayan also tweeted that the state's own bank would commence soon.
"Kerala's own Kerala Bank will commence soon. The High Court has dismissed all cases against the formation of the bank.
The process of the legal merger of 13 District Co- operative Banks with the Kerala State Co-operative Bank has been initiated," Vijayan said.
Earlier, the RBI had also granted its nod for the bank which would be the largest banking network in the state. The government had claimed that the objective was to strengthen the cooperative sector, while the Opposition had alleged that it would destroy the traditional cooperative sector.
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