GOI places Ganesh Bank of Kurundwad Ltd under Moratorium from Close of business on January 7, 2006

Case Brief

On RBI's application, the Central Government issued an order placing Ganesh Bank of Kurundwad Ltd. under moratorium. The moratorium runs from the close of business on January 7, 2006 up to and inclusive of April 6, 2006, or earlier if alternate arrangements are put in place. During this period, the bank may make only those payments permitted under the moratorium order, and depositors are allowed to withdraw balances from their accounts only up to Rs. 5,000 through any branch. The release says the action was taken in public interest, in the interest of depositors, and for banking-system stability, and notes the bank's weak financial position, including negative net worth, negative CRAR, high NPAs, and erosion of depositor money.