In a major regulatory move, the Reserve Bank of India (RBI) has superseded the board of directors of Mumbai-based New India Cooperative Bank for a period of 12 months and appointed an administrator to oversee its operations. The decision, announced on Friday, follows the imposition of restrictions on the bank due to governance concerns.
The RBI has appointed Shreekant, former Chief General Manager of the State Bank of India (SBI), as the Administrator to manage the bank’s affairs during this period.
Additionally, a ‘Committee of Advisors’ has been constituted to assist him in discharging his duties. The committee comprises Ravindra Sapra, former General Manager of SBI, and Abhijeet Deshmukh, a Chartered Accountant.
According to an RBI press release, “The above action is necessitated due to certain material concerns emanating from poor governance standards observed in the bank.”
The central bank has also referred to its earlier press release (2024-2025/2154) dated February 13, 2025, stating that it had already issued certain directions to the bank under sub-section (1) of Section 35A of the Banking Regulation Act, 1949, read with Section 56 of the Act, as applicable to cooperative societies.
The financial reports of New India Cooperative Bank for the fiscal year 2023-24 reflect significant losses. The bank recorded a net loss of Rs 30.74 crore in 2022-23 and Rs 22.77 crore in 2023-24, leading to the non-declaration of dividends for FY 2023-24.
As of March 31, 2024, the bank reported deposits of Rs 2,436 crore and advances of Rs 1,174 crore, with a total business volume of Rs 3,610 crore.
New India Cooperative Bank operates 28 branches, primarily in Maharashtra and Gujarat, with a strong presence in Mumbai.
The RBI’s intervention aims to stabilize the bank’s operations and restore confidence among its depositors and stakeholders.
