National Co-operative Bank: The Central Reserve Bank (RBI) has imposed certain restrictions on the Bengaluru-based cooperative bank National Co-operative Bank Limited. Bank customers facing operational problems will no longer be able to withdraw more than Rs 50,000 from their accounts. RBI has imposed a deposit withdrawal limit on the bank.
What are the restrictions imposed by RBI on National Co-operative Bank?
According to the order of the central bank, the restrictions imposed on the bank will remain in force for the next 6 months, under these restrictions, it will not be able to disburse new loans, nor renew old loans. The bank will not be able to make any new investment either. The Fund will not be able to borrow, take fresh deposits, distribute any payments under any of its obligations, enter into any agreement, and sell any of its assets.
What will be the effect on customers?
RBI has said in its instructions that “in particular, no depositor will be allowed to withdraw an amount exceeding Rs 50,000 from the total amount in any current or savings account or any other account.”
However, RBI has clarified that imposing this ban on the bank does not mean that its license is being cancelled. RBI said that “the bank will continue to do business under restrictions, until its economic condition improves, then looking at the situation, the Reserve Bank may consider changes in these instructions.”
