Mumbai: The Reserve Bank of India (RBI) superseded board of New India Co-operative Bank in Maharashtra for 12 months. RBI has appointed Shreekant, a former chief general manager of State Bank of India (SBI) as ‘Administrator’ to manage the affairs of the bank.
RBI has also appointed a ‘Committee of Advisors’ to assist the Administrator in discharging his duties. The members of the Committee of Advisors are Ravindra Sapra (former General Manager, SBI) and Abhijeet Deshmukh (chartered accountant).
‘The Board of Directors of New India Co-operative Bank, Mumbai, has been superseded. The action is necessitated due to certain material concerns emanating from poor governance standards observed in the bank’, the RBI said in a statement.
New India Co-operative Bank has 28 branches, mostly located in the Mumbai region.
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Earlier the RBI had imposed several restrictions on the lender including on withdrawal of funds by depositors, amid supervisory concerns. The restrictions came into force from the close of business on Thursday and would remain in force for a period of six months and are subject to review.
The lender, however, has been allowed to set off loans against deposits subject to the conditions stated in the RBI directions. It may incur expenditure in respect of certain essential items such as salaries of employees, rent, and electricity bills.
The RBI further said as from the close of business on February 13, 2025, the bank shall not, without prior approval, grant or renew any loans and advances, make any investment, and incur any liability, including acceptance of fresh deposits.
Eligible depositors would be entitled to receive deposit insurance claim amount of their deposits up to ?5 lakh from the Deposit Insurance and Credit Guarantee Corporation (DICGC).
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