Finance Minister Nirmala Sitharaman today met depositors of PMC Bank and assured them that she will speak to the RBI governor on urgency and distress of PMC depositors. If legislations are going to help curb malpractices and help in better regulating cooperative banks, the government would look into it, she said.

A group consisting of officials from the finance ministry and RBI will look into the PMC bank matter.

The PMC Bank crisis has sparked renewed concerns about India's banking sector. The RBI has taken charge of PMC, one of India's top five co-operative lenders with more than 900,000 depositors.

The RBI has barred the bank from renewing or granting any loans or making investments without prior approval of the central bank, while depositors can only withdraw a maximum of 25,000 from their PMC accounts over the next six months.

Mumbai Police on Monday arrested Joy Thomas, the former managing director of Punjab and Maharashtra Co-operative Bank (PMC), which has been accused of creating fictitious accounts to hide loans.

More than two dozen co-operative banks are now under RBI administration, but PMC Bank - with deposits of 11,620 crore as of March 31 - is by far the largest.

(Inputs from agencies)

Close