Reserve Bank of India has issued certain Directions to The Mudhol Co-operative Bank Ltd., Post Mudhol, Bagalkot District, Karnataka, whereby, as from the close of business on April 08, 2019, the aforesaid bank shall not, without prior approval of RBI in writing grant or renew any loans and advances.
The regulator also prevents the UCB from making 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 Directions.
The Direction is displayed on the bank’s premises for perusal by interested members of the public. In particular, a sum not exceeding Rs 1,000/- (Rupees one thousand only) of the total balance in every savings bank or current account or any other deposit account may be allowed to be withdrawn subject to conditions stated in the above RBI Directions.
The issue of the above Directions by the RBI should not per se be construed as cancellation of banking licence 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.
