RBI extends action period on Bhagyodaya Friends Urban Co-operative Bank

Case Brief

Reserve Bank of India has extended the period of its existing directions on Bhagyodaya Friends Urban Co-operative Bank Ltd., Warud, Distt. Amravati, Maharashtra. The directions were originally issued from the close of business on January 17, 2019 under Section 35A read with Section 56 of the Banking Regulation Act, 1949 (AACS), were modified from time to time, and had last been extended up to January 17, 2021. The present release continues those directions for a further three months, from January 18, 2021 to April 17, 2021, subject to review. The bank remains under restrictions and/or ceilings on withdrawal and acceptance of deposits. RBI also states that the issuance of directions should not be construed as cancellation of the banking licence, and that the bank will continue to undertake banking business with restrictions until its financial position improves.