If you are a
Lakshmi Vilas Bank's (LVB) customer, then from tomorrow onward your account will become that of DBS Bank account as the regulatory authorities have approved amalgamation of both the lenders with effect from November 27, 2020.
The Union Cabinet chaired by Prime Minister Narendra Modi on Wednesday, approved the Scheme of Amalgamation of Lakshmi Vilas Bank Limited (LVB) with DBS Bank India Limited (DBIL).
Earlier this month, to protect depositors' interest and in the interest of financial and banking stability, on RBI's application under section 45 of the Banking Regulation Act, 1949, LVB had been under a moratorium for 30 days.
Cabinet informs that after inviting suggestions and objections from the public and stakeholders, RBI prepared and provided a scheme for the bank's amalgamation for the Government's sanction, well in. advance of the end of the period of moratorium so that restrictions on withdrawal faced by the depositors are minimised.
Further, Cabinet said, "With the approval of the scheme, LVB will be amalgamated with DBIL from the appointed date, and with this, there will no further restrictions on the depositors regarding the withdrawal of their deposits."
LVB in its regulatory filing said, "the amalgamation will come into force on the Appointed date i.e. November 27, 2020, and all the branches of the Lakshmi Vilas Bank Ltd. will function as branches of DBS Bank India Ltd. with effect from this date."
To its customers, LVB said, "Customers, including depositors of the Lakshmi Vilas Bank Ltd., will be able to operate their accounts as customers of DBS Bank India Ltd. with effect from November 27, 2020."
That said, the moratorium on the LVB will cease to be operative from that date. Adding LVB stated that the DBS Bank is making necessary arrangements to ensure that service, as usual, is provided to the customers of the Lakshmi Vilas Bank.
Cabinet said, "The speedy amalgamation and resolution of the stress in LVB is in line with Government's commitment to a clean banking system while protecting the interests of depositors and the public as well as the financial system."
LVB was suspended for trading on exchanges due to procedural reasons on Thursday. The last stock performance is LVB staying on upper circuit limit of Rs7.65 per piece up 4.79% on Sensex.