Case Brief
RBI issued Directions under Section 35A read with Section 56 of the Banking Regulation Act, 1949 to The National Co-operative Bank Ltd., Bangalore, effective from the close of business on July 24, 2023. The directions prohibit the bank, without prior written approval of RBI, from granting or renewing loans and advances, making investments, incurring liabilities including borrowings and acceptance of fresh deposits, disbursing payments, entering into compromises or arrangements, and selling or otherwise disposing of assets except as permitted in the direction. Deposit withdrawals are capped at ₹50,000 per depositor across accounts, subject to specified conditions. RBI also clarified that the order is not a cancellation of banking licence and will remain in force for six months, subject to review.
Action Snapshot
- Primary Impact
- Business restriction
- Entity Type
- Co-operative bank
- Location