Anshumman Joshi led Dhanvarsha Group offers Rs 150 Crore Private Placement to Revive Samarth Sahakari Bank, Executes agreement.

• Agreement for Private Placement has been executed as per Section 12 of the Banking Regulations Amendment Act 2020; the move aims to make Solapur’s Samarth Sahakari Bank a Small Finance Bank.  

Mumbai, October 18, 2022 

Anshumman Joshi-led Dhanvarsha Group, a leading business conglomerate engaged in several sectors, including finance and banking, has offered a Rs 150 crore revival package for the Samarth Sahakari Bank Ltd. Solapur. The Group executed a Private Placement Agreement pertaining to an Investment of Rs. 150 crores into the bank as per Section 12 of the Banking Regulations Amendment Act 2020. Dhanvarsh Group is all set to initially infuse Rs 150 crore to meet the capital requirements of the Reserve Bank of India (RBI).

The Agreement for Private Placement was recently signed by Mr Anshumman Joshi, Chairman, Dhanvarsha Group. On behalf of the Samarth Sahakari Bank, it was signed by the Chairman, Mr Dilip Yashwant Atre. 

Samarth Sahakari Bank Ltd., Solapur, which once upon a time was a leading bank in Solapur in the cooperative sector with branches across Maharashtra, is presently in a dire state. Currently, Samarth Bank Ltd is under are under All-Inclusive Directions (AID) imposed under Section 35 (a) of the Banking Regulations Act. 1949 and several Master Circulars were issued from Time to Time. Under all-inclusive directions, the RBI restricts the bank from discharging its liabilities except as permitted by the central bank.

“We are expressing our interest by way of a firm proposal to infuse/invest sizable capital to the tune of Rs. 150 crores in the share capital of the Samarth Bank by way of private placement under Section 12 of the Banking Regulation (Amendment) Act, 2020, for the purpose of revival of the aforesaid Bank,” said Anshumman Joshi, Chairman, Dhanvarsha Group. Joshi is widely known as a saviour of the Cooperative Banking Sector. 

“A revival will be in the larger interest of all the Depositors and Shareholders of the Bank. We can infuse required funds Share Capital through our Group in phases. With in-principle approval by RBI, we would convert it to a Small Finance Bank through our Alternative Investment Fund (White & Brooks AIF LLP), which is under the process of licensing with SEBI. We are interested in converting this State Level Co-operative Bank to a Small Finance Bank as per the relevant RBI Norms,” added Mr Joshi.

Dhanvarsha Group has submitted the revival proposal and a copy of the agreement to the RBI, Union Finance Minister, Cooperative Commissioner, Govt of Maharashtra, Pune. The Group has prayed that the All-Inclusive Directions imposed under Section 35 (a) should be revoked, and its proposal should be considered seriously in the larger interest of the Depositors of the Bank.

“The revival package with an offer to infuse required money in the form of share capital has come as a relief to us. The agreement would also put us on our toes to make all efforts to revive the bank. We are thankful to Dhanvarsha Group, which has come forward with a robust revival plan. We have signed an agreement to execute the plan. Now, with new provisions, a cooperative bank may issue, by way of public issue or private placement, equity shares or preference shares or special shares, on face value or at a premium,” said Mr Dilip Yashwant Atre, Chairman, Samarth Sahakari Bank. 

Now a cooperative bank can also get funds through unsecured debentures or bonds, or other securities with an initial or original maturity of not less than ten years to any member of such a cooperative bank or any other person residing within its area of operation.

The Dhanvarsha Group has made it clear in the agreement that an infusion of Rs 15o crore would take place on receiving Exemption U/s 27 (3) of the Maharashtra Cooperative Societies Act.1960 and appointing Promoters’ Representatives in place of the existing Board of Directors of the Bank. It is expected that some sections of the Bye-Laws of the Bank will be amended to ensure the right to vote shall be given to the members of the revival group who are investing in the bank to revive it. 

Now, all eyes will be on the RBI, and approval will be eagerly awaited. Recently, the Central Bank has started out of the box thinking to give a push to cooperative banking in the country. It is widely admitted that cancellations of licenses would not be a viable solution as Union Cooperative Minister Mr Amit Shah has given a clarion call for One Cooperative Bank in Each District of the country.  

Disclaimer: This is a paid press release. No Journalists were involved in the creation and publishing of the content.

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