Case Brief
The Reserve Bank of India issued Directions under Section 35A read with Section 56 of the Banking Regulation Act, 1949 against The YASHWANT CO-OPERATIVE BANK Ltd., Phaltan, Maharashtra, effective from the close of business on May 29, 2025. The bank was prohibited, without prior written RBI approval, 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 disposing of assets except as allowed in the directions. RBI also barred withdrawals from savings, current, and other depositor accounts, while allowing limited set-off of loans against deposits and essential expenses such as salaries, rent, and electricity. RBI said it had engaged with the bank's board and senior management in the recent past, but the bank had not taken concrete steps to address supervisory concerns or protect depositors, necessitating the directions. The order remains in force for six months from May 29, 2025, subject to review.
Action Snapshot
- Primary Impact
- Business restriction
- Entity Type
- Co-operative bank
- Location