RBI imposes restrictions on Indian Mercantile Cooperative Bank. Details here
Premium- The central bank, however, added the directions should not per se be construed as a cancellation of the banking licence by the RBI.
The Reserve Bank of India(RBI) on Friday said it has imposed several restrictions on Indian Mercantile Cooperative Bank Ltd, Lucknow, including a cap of ₹1 lakh on withdrawals.
“It is hereby notified for information of the public that in exercise of powers vested in it under sub section (1) of Section 35 A read with Section 56 of the Banking Regulation Act (AACS), 1949, the Reserve Bank of India (RBI) vide Directive Ref. No. DoS.CO.OCCD/185569/12.28.007/2021-22 dated January 28, 2022, has issued certain Directions to Indian Mercantile Cooperative Bank Ltd Lucknow, whereby, as from the close of business on January 28, 2022, the bank shall not, without prior approval of RBI in writing grant or renew any loans and advances, make any investment, incur any liability including borrowal of funds and acceptance of fresh deposits, disburse or agree to disburse any payment whether in discharge of its liabilities and obligations or otherwise, enter into any compromise or arrangement and sell, transfer or otherwise dispose of any of its properties or assets except as notified in the RBI Direction dated January 28, 2022, a copy of which is displayed on the bank's premises for perusal by interested members of the public," the RBI said in a statement.
In particular, a sum not exceeding ₹100,000 (Rupees one lakh only) of the total balance across all savings bank or current accounts or any other account of a depositor, may be allowed to be withdrawn subject to the conditions stated in the above RBI Directions.
The central bank, however, added the directions should not per se be construed as a cancellation of the banking licence by the RBI.The bank will continue to undertake banking business with restrictions till further notification from RBI. The Reserve Bank may consider modifications of these Directions depending upon circumstances.
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These Directions shall remain in force for a period of six months from the close of business on January 28, 2022 and are subject to review.
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