Pune: Defence Accounts Co-operative Bank Ltd. Faces RBI Restrictions on Loans, Advances, and Investments
Sumit Singh
Pune, 13th March 2023: The Reserve Bank of India (RBI) has issued certain directions to Defence Accounts Co-operative Bank Ltd., Pune, whereby 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 March 09, 2023, a copy of which is displayed on the bank’s website / premises for perusal by interested members of the public. The order has come into effect from March 10, 2023.
In particular, a sum not exceeding Rs 30,000 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the total balance across all savings bank or current accounts or any other account of a depositor, may be allowed to be withdrawn subject to the conditions stated in the above RBI directions.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 eligible depositors would be entitled to receive deposit insurance claim amount of his/her deposits up to a monetary ceiling of Rs five lakh in the same capacity and in the same right, from the Deposit Insurance and Credit Guarantee Corporation, under the provisions of Section 18A of the DICGC Act (amendment) 2021, based on submission of willingness by the concerned depositors. The depositors may contact their bank officials for further information.
The issue of the above directions by the RBI should not per se be construed as cancellation of banking license by RBI. 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.
These directions shall remain in force for a period of six months from the close of business on March 10, 2023 and are subject to review.
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