BackRBI extends period of restriction on 2 co-operative banks. Find out!
While RBI extended restrictions on Laxmi Co-operative Bank for three months, the period was extended by six months in the case of Sri Guru Raghavendra Sahakara Bank.
PremiumThe Reserve Bank of India (RBI) on Wednesday extended the period of restrictions on two banks. These are Solapur-based Laxmi Co-operative Bank and Bengaluru-based Sri Guru Raghavendra Sahakara Bank Niyamitha.
While RBI extended restrictions on Laxmi Co-operative Bank for three months, the period was extended by six months in the case of Sri Guru Raghavendra Sahakara Bank.
The Laxmi Co-operative Bank:
RBI had issued directions to the banking exercise of powers vested in it under sub-section (1) of Section 35 A read with Section 56 of the Banking Regulation Act, 1949 (AACS) from the close of business on November 12, 2021.
The directions stipulate certain restrictions and /or ceilings on withdrawal /acceptance of deposits.
A copy of the restrictions is currently displayed on the bank’s premises for interested members of the public to peruse. Reserve Bank of India may consider modifications of the Directions depending upon the circumstances.
In a statement today, RBI said, "These directions shall continue to apply to the bank for a further period of three months from May 12, 2022, to August 11, 2022, subject to review."
"The issue of Directions should not per se be construed as a cancellation of a banking license by the Reserve Bank of India. The bank will continue to undertake banking business with restrictions till its financial position improves," RBI said.
Sri Guru Raghavendra Sahakara Bank Niyamitha:
RBI has extended the period of restrictions on the bank for another six months starting from May 11, 2022, to November 10, 2022, subject to review.
RBI had issued directions to the bank under Section 35 A read with Section 56 of the Banking Regulation Act, 1949 dated January 2, 2022. The validity later was extended from time to time, dated January 10, 2022, up to May 10, 2022.
However, now the period is extended till November 10, 2022.
Under the directions, there are restrictions and ceilings on withdrawals and deposits on Sri Guru Raghavendra Sahakara Bank.
The directions are in the public interest. Other terms and conditions of the Directives under reference shall remain unchanged.
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