RBI supersedes board of Irinjalakuda Town Co-operative Bank, appoints administrator

Reserve Bank of India

The Reserve Bank of India (RBI) on October 7 superseded the Board of Directors of Irinjalakuda Town Co-operative Bank Ltd, citing concerns over the lender’s deteriorating financial health and governance issues.

Following the move, the RBI has appointed Raju S. Nair, former Vice President at Federal Bank, as the Administrator to manage the bank’s affairs during the period of supersession.

To support him, the central bank has also constituted a Committee of Advisors comprising Mohanan K, former Deputy General Manager of South Indian Bank, and T.A. Mohamed Sageer, former Vice President of Federal Bank, RBI said in a release.

According to the RBI, the action was “necessitated due to certain material concerns emanating from continued poor financial condition and governance standards observed in the bank.”

On July 30, the RBI issued certain Directions to Irinjalakuda Town Co-operative Bank Ltd (“the bank”), whereby, as from the close of business on July 30, 2025, the bank shall not, without prior approval of RBI in writing, grant or renew any loan or advance, make any investment, incur any liability including borrowing  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.

RBI has in the recent past engaged with the Board and Senior Management of the bank for improvement in its functioning. However, lack of concrete efforts taken by the bank to address the supervisory concerns as well as non-infusion of capital funds to maintain minimum regulatory capital necessitated issuance of these directions to protect the interest of depositors of the bank, RBI said on July 30.