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Now, curbs on Karnataka co-operative bank. Another PMC-like crisis unfolding?

The Karnataka bank situation reminds of the Punjab and Maharashtra Co-operative (PMC) bank crisis of 2019, when it was revealed that the PMC bank defaulted on loans to the tune of Rs. 6,500 crore.

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Karnataka Co-operative bank

The Reserve Bank of India (RBI) has imposed curbs on a co-operative bank in Karnataka, restricting the withdrawal limit to Rs 35,000. The central bank also restrained Sri Gururaghavendra Sahakara Bank Niyamitha (SGRSBN) bank in Bengaluru from granting or renewing loans, accepting deposits or making investments for a period of six months.

The notification came on January 10.

However, the bank’s license is not cancelled and it will continue to do business with restrictions.

Worried depositors rushed to the bank to hold talks with the management. A meeting is scheduled for January 19, in view of the issue.

The situation was unexpected, considering the fact that SGRSBN bank received the best NPA management award in 2018 from the National Federation of Urban Cooperative Banks and Credit Societies Limited (NAFCUB).

The bank’s chairman K Ramakrishna has assured that the depositors’ money is “cent percent safe” with the bank. He blamed the 62 loans that locked up Rs 300 crore of deposit for the present situation.

BJP’s south Bengaluru MP Tejasvi Surya said that the customers need not panic, and that the finance minister has been informed about the matter.

Surya in his statement said that FM Nirmala Sitharaman has assured him that “the government will do everything in its capacity to protect the interests of the depositors and the long term interests of the bank. The statement added that Surya spoke to Sitharaman three times on January 13 and got reassurance from the minister that the interests of investors will be safeguarded.

The scenario reminds of the Punjab and Maharashtra Co-operative (PMC) bank crisis of 2019, when it was revealed that the PMC bank defaulted on loans to the tune of Rs. 6,500 crore.

On September 24, 2019, the RBI restrained the bank from doing any business for six months, while also capping the withdrawal limit to Rs 1,000, and later to 25,000.

It has to be noted that in 2013, an International Labour Orgranisation (ILO) report said that co-operative banks performed better than its competitors during the 2007-08 financial crisis.

Issue of dual regulation

Some experts attribute the current problems with the co-operative banks to dual regulation. These banks are regulated under both banking and co-operative legislation, by the RBI and the Registrar of Co-operative Societies (RCS) respectively.

The RCS takes care of administrative issues and controls the management elections.

Therefore, although the said banks came under the regulation of the RBI partially, when it came to bank management, the respective state governments had higher control.

Bringing co-operative banks under one regulatory mechanism might be a solution to the crisis, some believe.

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Himanta Biswa Sarma says Assam may get 18-19 ministers in new NDA government

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Himanta sharma

Assam Chief Minister-designate Himanta Biswa Sarma on Sunday said the new BJP-led NDA government in the state is likely to have around 18 to 19 ministers in the council of ministers.

Speaking to reporters ahead of the oath-taking ceremony scheduled for May 12, Sarma said discussions regarding the final composition of the cabinet are still underway and no names have been finalised yet.

“There may be around 18-19 ministers, but whether we include new faces or retain experienced ones will depend on the guidance we receive,” Sarma said while responding to questions on cabinet formation.

The swearing-in ceremony of the new Assam government will take place at the Veterinary College ground in Guwahati. Sarma is set to begin his second consecutive term as chief minister after the BJP-led NDA secured a sweeping victory in the Assam Assembly elections.

The NDA won 102 seats in the 126-member Assam Assembly, paving the way for the alliance to form the government for a third straight term in the state.

Sarma also said the new government would continue focusing on Assam’s welfare and development over the next five years, adding that the alliance had received a strong public mandate in the elections.

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Bhagwant Mann’s cousin Gyan Singh Mann joins BJP in Punjab

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Punjab Chief Minister Bhagwant Mann suffered a political setback after his cousin Gyan Singh Mann joined the Bharatiya Janata Party in Punjab on Sunday. The development comes at a time when political tensions between the BJP and the Aam Aadmi Party have intensified in the state.

Gyan Singh Mann joined the BJP in the presence of Haryana Chief Minister Nayab Singh Saini and senior BJP leaders. BJP leaders described the move as a sign of growing support for the party in Punjab ahead of upcoming political contests in the state.

The BJP has recently sharpened its attacks on the AAP government over issues including law and order, corruption allegations and political defections. Political friction between the two parties has also increased after recent protests and clashes involving party workers in Punjab.

The latest switch comes amid broader political turbulence for the AAP in Punjab. In recent weeks, the party has faced internal strain following high-profile exits and accusations exchanged between leaders of both parties.

Neither Bhagwant Mann nor the AAP leadership immediately issued a detailed public response to Gyan Singh Mann joining the BJP at the time of reporting.

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Supreme Court asks Mamata Banerjee camp to file fresh pleas over Bengal SIR-linked poll margins

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Supreme Court

The Supreme Court on Monday asked former West Bengal Chief Minister Mamata Banerjee and several leaders of the All India Trinamool Congress to file fresh petitions regarding constituencies where the number of deleted voters during the Special Intensive Revision (SIR) process allegedly exceeded the winning margin in the recent Assembly elections.

The matter is linked to the controversial SIR exercise conducted before the 2026 West Bengal Assembly elections. Opposition parties, especially the TMC, have repeatedly alleged that large-scale deletions from electoral rolls affected the outcome in several closely contested seats.

During the hearing, the Supreme Court reportedly advised the petitioners to move fresh pleas focused on specific constituencies where the disputed deletions were higher than the victory margin. The court’s remarks could pave the way for a closer judicial review of election results in those seats.

The Special Intensive Revision became one of the biggest political flashpoints ahead of the Bengal polls. The exercise led to the removal of a significant number of names from voter lists, triggering allegations from opposition parties that eligible voters had been disenfranchised.

The BJP secured a historic victory in the West Bengal Assembly elections, forming the government in the state for the first time. However, the opposition has continued to question the fairness of the electoral process and the impact of the SIR exercise on poll outcomes.

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