Money & Banking

RBI extends validity of the Directions issued to Sri Guru Raghavendra Sahakara Bank

Our Bureau Mumbai | Updated on July 10, 2020 Published on July 10, 2020

The Reserve Bank of India (RBI) extended the validity of its Directions to Bengaluru-based Sri Guru Raghavendra Sahakara Bank Niyamitha for a further period of six months from July 11, 2020 to January 10, 2021, subject to review.

The urban co-operative bank was placed under Directions on January 02, 2020 for a period of six months up to close of business on July 10, 2020.

After reviewing he bank’s liquidity position and its ability to pay the depositors, the central bank enhanced the limit for withdrawal per depositor to ₹1 lakh, inclusive of ₹35,000 allowed earlier on June 19.

With the above relaxation, more than 54 per cent of the depositors of the bank will be able to withdraw their entire account balance, the RBI said last month.

The RBI, on January 10, said the issue of Directions should not per se be construed as cancellation of banking license.

“The bank will continue to undertake banking business with restrictions till its financial position improves. The Reserve Bank may consider modifications of these Directions depending upon circumstances,” the central bank then said.

According to a report in The Hindu, the Anti-Corruption Bureau (ACB) had searched the offices of the Bank and its office bearers last month in connection with an alleged fraud.

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Published on July 10, 2020
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