RBI extends restrictions on Nashik Co-operative bank

RBI extended restrictions on Padmashri Dr Vitthalrao Vikhe Patil Co-operative Bank for a period of six months due to its weak financial position.

According to the RBI’s directions, depositors will be allowed to withdraw a sum not exceeding Rs 1,000 of the total balance held in every saving bank or current account or any other deposit account.

The RBI said Padamshree Dr Vitthalrao Vikhe Patil Co-operative Bank Ltd, Nashik, without its prior approval, will also not be able to grant or renew any loans. It has been stopped from making advances or investment. The bank can’t incur any liability, including borrowing of funds and acceptance of fresh deposits. It also can’t disburse or agree to disburse any payment whether in discharge of its liabilities and obligations or otherwise.

Besides, it will not be able to enter into any compromise or arrangement and sell, transfer or otherwise dispose any of its properties or assets, except as notified in the RBI directions dated May 18, 2018, said a notification from the central bank.

The central bank also said that the issue of directions should not be construed as the cancellation of its banking license. The bank will continue to undertake banking business with restrictions till its financial position improves. The tenor of directive period begins from November 19, 2018, to May 18, 2019.