The Reserve Bank of India (RBI) has extended the restrictions imposed on Punjab and Maharashtra Cooperative Bank (PMC Bank) until December 31, 2021. The central bank had placed PMC Bank under directions on September 23, 2019 after a multi-crore scam was unearthed at the cooperative bank. The directions were first imposed until March 26, 2021 and were extended until June 30, 2021. 

“Taking into account the time required for completion of various activities involved in the process, it is considered necessary to extend the aforesaid directions,” the RBI said on June 25. “Accordingly, it is hereby notified for the information of the public that the validity of the aforesaid directive, dated September 23, 2019, as modified from time to time, has been extended for a further period from July 1, 2021 to December 31, 2021, subject to review,” a statement from the central bank read. 

Recently, the RBI had granted an in-principle approval to Centrum for a small finance bank (SFB) in response to its expression of interest. Centrum Financial Services, along with Resilient Innovation (BharatPe), had proposed to acquire PMC Bank. RBI said that taking into account the time required for the completion of reconstruction of PMC Bank, the directions have been extended. The in-principle nod for Centrum to set up an SFB, along with BharatPe, is valid for 120 days.