RBI curbs City Co-op Bank from granting loans, making investments and limits withdrawals to 1,000 per a/c
RBI has placed restrictions on the City Co-operative Bank and limited withdrawals to Rs 1,000 per account. The bank has also been barred from granting loans, making investments, creating fresh liabilities or dealing with its assets in any way.
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Such directions are issued when the financial condition of a bank is precarious. "The issue of the directions by the Reserve Bank should not, per se, be construed as cancellation of banking licence by the RBI. The bank will continue to undertake banking business with restrictions till its financial position improves," the RBI said in a statement.
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The bank board is headed by Shiv Sena MP Anandrao Adsul. It has 10 branches in the city and had a share capital and reserves of Rs 55 crore as of March 2016. As on March 2016, the bank deposit base was Rs 534 crore and it had advances of Rs 362 crore. The bank said its NPAs stood at 8.9% and had a capital adequacy ratio of 10.16% in March 2016.