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Mumbai: Customers queue outside New India Co-operative Bank as RBI bars lender from fresh business

RBI said the directions were necessary due to concerns arising from 'recent material developments' at the bank

February 14, 2025 / 14:52 IST
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Mumbai: Customers queue outside New India Co-operative Bank as RBI bars lender from fresh business

Customers gathered outside Mumbai-based New India Co-operative Bank on February 14, a day after Reserve Bank of India barred the lender from issuing new loans and suspended deposit withdrawals for six months, citing supervisory concerns and the lender's liquidity position.

RBI said the directions were necessary due to concerns arising from "recent material developments" at the bank, and to protect the interest of depositors, although did not elaborate on the specifics of these concerns.

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The RBI also ordered the co-operative bank not to make any investments or borrow funds.

"...from the close of business on February 13, 2025, the bank shall not, without prior approval of RBI in writing, grant or renew any loans and advances, make any investment, incur any liability including borrowal of funds and acceptance of fresh deposits, disburse or agree to disburse any payment whether in discharge of its liabilities and obligations or otherwise, enter into any compromise or arrangement and sell, transfer or otherwise dispose of any of its properties or assets," said RBI in a circular.