Case Brief
The Reserve Bank of India issued Directions under Section 35A of the Banking Regulation Act, 1949 (as applicable to co-operative societies) read with Section 56 to Nashik Jilha Girna Sahakari Bank Ltd., Nashik, Maharashtra. From the close of business on September 9, 2015, the bank was prohibited from granting or renewing loans and advances, making investments, incurring liabilities including borrowings and fresh deposits, disbursing payments, entering compromise or arrangement, and selling or transferring assets except as permitted under the earlier RBI directions dated September 8, 2015. Depositors were allowed to withdraw up to ₹1,000 from each savings/current/other deposit account subject to the stated conditions. RBI clarified that the directions should not be construed as cancellation of banking licence and that the bank would continue to undertake banking business with restrictions until its financial position improves.
Action Snapshot
- Primary Impact
- Business restriction
- Entity Type
- Co-operative bank
- Location