RBI said that the directions should not be taken as cancellation of banking license. According to the Reserve Bank, this bank will continue to do banking business with restrictions till the financial condition improves.
Central Reserve Bank has taken major action on Tamil Nadu based Musiri Urban Co-operative Bank. After this action of the Reserve Bank, the customers of the bank will now be able to withdraw only up to Rs 5000. This ban will remain in force for the next six months. During this, the Reserve Bank will keep reviewing the ban.
After the action of the Reserve Bank, the co-operative bank cannot give loan without approval and neither can make any investment. Also can’t pay. The bank also cannot dispose of any property. The central bank said- withdrawal of more than Rs 5,000 cannot be allowed in all savings bank or current accounts or any other account of the depositor.
The Reserve Bank said that eligible depositors will be entitled to receive deposit insurance claim amount for deposits up to Rs 5 lakh from the Deposit Insurance and Credit Guarantee Corporation. However, RBI said that the directions should not be taken as cancellation of banking licence. According to the Reserve Bank, this bank will continue to do banking business with restrictions till its financial condition improves.
