Saraswat Bank seeks amalgamation of troubled New India Cooperative Bank
Saraswat Bank, the country's largest cooperative bank, has approached the Reserve Bank of India (RBI) for the acquisition of the troubled New India Cooperative Bank.
"We have voluntarily approached the RBI for the amalgamation of New India Cooperative with Saraswat Bank. Of course, this is subject to approval of shareholders of both banks," Saraswat Bank chairman Gautam Thakur said on Tuesday.
The scheme of amalgamation will be put in front of the shareholders of both banks, and once they approve, it will go to the RBI for final approval. Thakur is hopeful that the process would be completed by August-September this year.
The Reserve Bank had superseded the board of Mumbai-based New India Cooperative Bank in February, and the Mumbai police had registered a case against the bank's former general manager for allegedly siphoning off ₹122 crores from the bank.
The Economic Offences Wing (EOW), which is probing the case, had said that ₹122 crore had been siphoned off from the safes of the bank’s Prabhadevi and Goregaon offices in Mumbai. The agency has filed a chargesheet in this regard.
Thakur also informed that a due diligence of New India Bank has already been done. A special audit of the lender will also be done before the amalgamation. He also assured that the depositors of New India Bank would not have to take a haircut.
Saraswat Bank is the largest cooperative lender in the country with a total business of ₹91,814 crores, as of March 31, 2025. However, it had a net profit of ₹518 crores last year, and operates 312 branches across 8 states.
New India Cooperative Bank had a total business of ₹3,561 crores, and reported a negative net worth of ₹102.74 crores in the 2024-25 financial year. It operated 27 branches.
Saraswat Bank has had a history of acquiring financially weak cooperative banks, having taken over seven such lenders in the past.
Why is Saraswat interested in amalgamating New India Cooperative Bank?
"We are the largest in the cooperative space, and it is incumbent on us as the leader of this sector, being the largest, to step in whenever we feel it is necessary," Thakur said.
He claimed that the business of the 7 banks it had acquired rose from ₹1,900 crores to ₹9,200 crores in five years, and was confident of turning around New India Cooperative Bank too.
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