(i) Unsecured, subordinated, non-convertible redeemable debentures/bonds,

(ii) Special shares which are non-voting in nature (as opposed to shares with membership rights) which could be issued even at a premium,

(iii) Redeemable cumulative preference shares, and

(iv) Long term subordinated deposits with maturity in excess of 15 years.

Since UCBs come under the purview of the Co-operative Societies Act of the State in which they are registered or the Multi-state Co-operative Societies Act (2002), the provisions of which are not similar in certain respects, the Group has suggested necessary amendments to the Acts/Rules framed under them to facilitate issuance of some of the instruments proposed by it.

It may be recalled that an announcement was made in the Annual Policy Statement for 2006-07 to constitute a working group to examine the issue of share capital of UCBs and to identify alternate instruments / avenues for augmenting their capital funds. Accordingly, a Working Group was constituted under the Chairmanship of Shri N.S. Vishwanathan, Chief General Manager-in-Charge, Urban Banks Department, Reserve Bank of India. The other members of the group were Shri Anil Diggikar*, Commissioner for Cooperation & Registrar of Cooperative Societies (RCS), Government of Maharashtra, Shri J.C. Sharma, Commissioner for Cooperation & RCS, Government of Andhra Pradesh, Shri D. Krishna, Chief Executive, National Federation of Urban Cooperative Banks and Credit Societies Ltd (NAFCUB), Prof. Mukund Ghaisas, Chairman, Maharashtra State Urban Cooperative Banks Federation and Shri K. D. Zacharias, Legal Adviser, Reserve Bank of India.

* In place of Dr. S. K. Sharma, who was initially the member of the Working Group in his capacity as Commissioner for Cooperation & Registrar of Cooperative Societies, Government of Maharashtra.

Alpana Killawala
Chief General Manager

Press Release : 2006-2007/697