In view of the growing financial condition of the lenders, the RBI on Friday imposed a number of restrictions on Shankarrao Pujari New Nagari Sahakari Bank Limited, Ichalkaranji, Kolhapur, including withdrawal.
However, 99.84 per cent of the depositors are fully covered by the DICGC insurance scheme. Under the Deposit Insurance and Credit Guarantee Corporation (DICGC) insurance scheme, deposits up to Rs 5 lakh are insured.
The RBI said in a statement that the ban would remain in effect for six months after the business closes on May 13, 2022, and is subject to review.
“Considering the current liquidity position of the bank, any amount may be allowed to be withdrawn from the total balance of all savings bank or current accounts or any other account of a depositor, but conditionally the loan is allowed to be set off against the deposit,” it said.
It further said that the issuance of the directive should not be construed as revoking the banking license by the RBI.
“The bank will continue banking business with the restrictions described in the guidelines until its financial condition improves,” it said.
The Reserve Bank added that it could consider changing the guidelines depending on the situation.
The Bank may not, among other restrictions, approve or renew any loan and advance, make any investment, bear any liability and dispose of any of its assets or assets, except with the prior approval of the RBI.