It is reported in a section of the press that the Reserve Bank of India (RBI) has communicated to around 100 loss making cooperative banks across the country to surrender their banking licences, merge with healthier banks or face liquidation and that banks in Gr.III category have been given six months time to improve performance and graduate to the next level.

It is clarified that the Reserve Bank has not issued any such communication to any bank. It may be mentioned here that the Reserve Bank is taking various measures to address the problem of weak entities in the urban cooperative banking sector and as a part of this effort, had placed a draft Vision Document for Urban Cooperative Banks in public domain. The Vision Document is in the process of being finalised based on responses received from various quarters. It is expected that the ongoing dialogue will strengthen the sector.