Mumbai: The Reserve Bank of India (RBI) on Wednesday placed restrictions on the business activities of City Co-operative Bank Ltd till such time as its financial position improves.

In a directive issued to the bank, the regulator said that the customers of the cooperative bank will not be allowed to withdraw more than Rs1,000 of the total balance held in savings or current accounts or any other deposit account. The bank will also have to take prior approval from the RBI before it can disburse loans, make any investment, borrow funds or accept fresh deposits.

These directions are effective from the close of business on 17 April, 2018. “The issue of the directions by the Reserve bank should not, per se, be construed as cancellation of banking licence... The bank will continue to undertake banking business with restrictions till its financial position improves," the RBI said.