Another co-op bank put under direction by the RBI is Sri Mallikarjuna Pattana Sahakari Bank Niyamita, Maski. From the close of business on July 18, 2022, the bank shall not, without prior approval of RBI in writing, grant or renew any loans and advances, among others.
Considering the bank’s present liquidity position, no amount from the total balance across all savings bank or current accounts or any other account of a depositor, may be allowed to be withdrawn, but are allowed to set off loans against deposits subject to the conditions stated in the above RBI Directions. However, 99.53 per cent of the depositors are fully covered by the DICGC insurance scheme.
The issue of the above Directions by the RBI should not per se be construed as cancellation of banking license by RBI. The bank will continue to undertake banking business with restrictions as stated in the Directions till its financial position improves. The Reserve Bank may consider modifications of these Directions depending upon circumstances.
These Directions shall remain in force for a period of six months from the close of business on July 18, 2022 and are subject to review.