Sirohi-based bank may acquire Sumco Bank
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After Maharashtra, it is now the turn of Rajasthan to make foray into the urban co-operative banking sector of Gujarat through the takeover route. In line with the Reserve Bank of India (RBI) policy of facilitating merger of weak banks with strong banks, a bank from Rajasthan after having acquired one bank in May has proposed to takeover another cooperative bank in the state.
If the proposal is through, the Sirohi-based Madhav Nagrik Sahakari Bank Ltd will soon acquire the Surendranagar Mercantile Co-operative Bank Ltd (Sumco Bank). The Sirohi bank had also acquired the Deesa Nagarik Sahakari Bank in Banaskantha district in May. Madhav Bank has nine branches in Gujarat and the bank is in the process of acquiring the Sumco Bank.
Madhav Bank has branches in Surat, Ahmedabad, Deesa, Dhanera, Bhildi and Palanpur, all belonging to the erstwhile Deesa Nagarik Sahakari Bank. Now, with the acquisition of Sumco Bank in Surendranagar, the bank has plans to spread its operations further in the state.
"Earlier, we had rejected proposals from three co-operative banks in Gujarat and as of now have no plans to acquire any bank other than Sumco Bank," said Mukesh Modi, a member of Task Force on Urban co-operative banks (TAFCUB) and managing director of Madhav Bank.
Sources in the Sumco Bank confirmed the bank had moved a proposal for merger with the Madhav Bank and that a decision was expected in a week or so.
The other two merger proposals in the pipeline include those of Rushika Mahila Nagarik Bank with Junagadh Commercial Co-operative Bank and Sanand Urban Co-operative Bank with either Prime Bank, Surat or Junagadh Bank, said sources in the banking industry.
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