Banking: Do you also have an account with this bank? The RBI has imposed strict restrictions..
The Reserve Bank of India (RBI) has taken strict measures in view of the deteriorating financial condition of Mumbai's Mogaveera Co-operative Bank. This move by the central bank has caused anxiety among the bank's account holders. Under the new RBI directives, no account holder will be able to withdraw more than ₹1 lakh from their savings, current, or any other type of account. These restrictions have been imposed for an initial period of six months and will be subject to periodic review.
In a statement, the RBI announced that these restrictions came into effect at the close of business on Friday. According to the statement, the co-operative bank can no longer sanction loans or advances, nor can it renew existing ones. Furthermore, the bank is prohibited from making investments, incurring new liabilities, borrowing funds, or accepting new deposits. The statement noted, "In view of the bank's current liquidity position, it has been directed to allow withdrawals of up to a maximum of ₹1 lakh per depositor across all their savings, current, or other accounts."
**RBI in contact with bank management**
The RBI stated that it had been in constant communication with the bank's board of directors and senior management regarding improvements to its operations. "However, the bank failed to make concrete efforts to address supervisory concerns and protect the interests of depositors. Consequently, it became necessary to issue these directives," the statement added.
**Banking license not cancelled**
The RBI clarified that these directives do not amount to a cancellation of the banking license. The bank may continue to conduct banking operations subject to these restrictions until its financial position improves.
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