With 1,100 shareholders and nearly 80,000 depositors restrained from withdrawing their hard-earned money from the financially strained Baghat Urban Cooperative Bank in Solan since October 2025, the civic body poll in Solan is likely to bear its impact.
Lack of action against those responsible for disbursing unsecure loans has become a cause of particular concern among the depositors as they feel the government is indifferent to their hardship.
The Reserve Bank of India (RBI) had imposed severe restrictions on the bank on October 8, 2025, including a cap on withdrawals at Rs 10,000 per customer for six months initially. It was later extended by three months in April this year. The bank has also been prohibited from issuing new loans, renewing credit limits or accepting fresh deposits without prior approval.
With concerted efforts to recover loans, the NPA has been reduced to Rs 105 crore, but the bank has to bring it down to Rs 90 crore by June-end for the RBI to lift sanctions. Its net NPA has also shown an improvement and it stood at 7.25 per cent now.
After imposing sanctions for six months in October 2025, the RBI had further extended it to three more months on April 6. The shareholders and depositors who were hoping to get access to their deposits are living in constant fear of losing their money if the bank fails to make a substantial recovery by June-end.
They rued that not even one official responsible for disbursing unsecure loans has been booked till now even as a surcharge enquiry was underway by a committee constituted by the Registrar Cooperative Societies since March.
"The government failed to dissolve the Board of Management under whom the bank has been put under sanctions. Appointing an administrator to run the bank would have helped restore the confidence of the depositors," observed MN Sofat, a shareholder and a former BJP minister.
He added that even initiatives like financial inclusion sought by the bank management from the state government, besides merger with the HP State Cooperative Bank, have failed to come through, signalling the government's indifference towards the plight of the poor depositors.
The financial imbroglio plaguing the bank is a typical case of the politicians plundering public money and then getting away without any punitive action, say depositors. "Politically connected defaulters not only shared the stage with the Chief Minister at Solan yesterday, but also stalled possession of their properties by the bank, thus hitting the recovery process of the bank," rued a depositor.
Under such circumstances, there was little respite that the depositors could get from the ruling Congress. The BJP too has failed to raise the issue vociferously.