Kanpur based People’s Co-operative Bank has been barred by the Reserve Bank of India from granting fresh loans and also accepting deposits for six months owing to its current weak financial position.
Without prior approval from the RBI in writing, the bank shall not make any sort of investments, grant loans, or incur any sort of liability of funds from the close of business on June 10.
No withdrawal of the amount of a depositor will be allowed from the Co-operative bank from June 10 onwards until the bank shows promising growth in the next few months.
The People’s co-operative bank has also been barred from selling, transferring or depositing any sort of properties or assets. These restrictions will continue in force for the next six months and are subject to review.
This, however, does not mean that the banking license of the co-operative bank has been cancelled. The bank will continue to undertake its banking business with the restrictions imposed until its financial position improves.