Case Brief
The press release states that The Lakshmi Vilas Bank Ltd. had been under severe stress, with continuous losses over three years, eroding net worth, rising NPAs, declining advances, inadequate capital, deposit outflows, low liquidity, and governance problems. The bank had earlier been placed under PCA and failed to produce a concrete revival or amalgamation proposal despite repeated engagement by RBI. RBI therefore sought moratorium under section 45 of the Banking Regulation Act, 1949, and the Central Government imposed a 30-day moratorium effective immediately. RBI also mentioned that it had drawn up an amalgamation scheme and issued directions under section 35A.
Action Snapshot
- Primary Impact
- License suspension
- Entity Type
- Bank
- Action Type