Kolkata: Panicked depositors began queuing up outside Mumbai-based New India Co-operative Bank following Reserve Bank of India announcing that the bank cannot grant or renew any loan or advance from the close of business on February 13, 2025. The bank also stands barred from making any new investments or accept new deposits, or disburse any payment and sell off any property.
According to reports, account holders in the bank lined up outside the Vijayanagar branch in Mumbai’s Andheri. Everyone is worried about taking out their deposits in the bank and they were alleging that bank authorities were simply not responding to their anxious queries. Its customer support services were also not functioning. Among those queuing up were a number of senior citizens, who have their precious savings in the bank.
RBI measure to be in effect for 6 months initially
The RBI’s punitive measures on the Mumbai-based bank is supposed to be in place for at least six months and will be reviewed by the banking regulator once this period is over. “Considering the bank’s present liquidity position, the bank has been directed not to allow withdrawal of any amount from savings bank or current accounts or any other account of a depositor… These directions are necessitated due to supervisory concerns emanating from the recent material developments in the bank, and to protect the interest of depositors of the bank,” RBI mentioned in a statement.
At the end of the previous financial year FY24, New India Co-operative Bank had deposits worth Rs 2,436 crores. According to the rules, the Deposit Insurance and Credit Guarantee Corporation (DICGC) safeguards deposits through insurance claims but the ceiling on this feature is Rs 5 lakh per customer.
The RBI has made it clear that its measure follows concerns about the liquidity position of New India Co-operative Bank. It has led the banking regulator to restrict withdrawal of funds from savings, current, or any other depositor accounts in the bank.
A number of customers have lined up outside branches of New India Co-operative Bank and a lot of the panicking customers are senior citizens many of whom have parked a lot of their hard-earned money with this bank. Biz News Business News – Personal Finance News, Share Market News, BSE/NSE News, Stock Exchange News Today
