Reserve Bank of India: RBI said that Color Merchants Cooperative Bank can neither give loans nor renew old loans without its prior permission. Apart from this, he has also been barred from making any investment and accepting new deposits.
Color Merchant Co-Operative Bank: Along with imposing fine on SBI, Indian Bank and Punjab and Sindh Bank, the Reserve Bank of India (RBI) has also taken action against Color Merchants Cooperative Bank. RBI has imposed several restrictions in view of the deteriorating financial condition of Ahmedabad-based Color Merchants Co-operative Bank. Under the first restriction, a customer of the bank will be able to withdraw a maximum of Rs 50,000.
Restrictions became effective from September 26
In the statement issued by RBI, it was said that the restrictions imposed by it have become effective from September 26. These restrictions will remain in force for the next six months. RBI said that Color Merchants Cooperative Bank can neither give loans nor renew old loans without its prior permission. Apart from this, he has also been barred from making any investment and accepting new deposits. RBI said, ‘A depositor will not be allowed to withdraw more than Rs 50,000 from his total deposits within the bank.’
The action should not be viewed as license revocation.
Apart from this, the central bank said that the account holders of the bank will get deposit insurance benefits from Deposit Insurance and Credit Guarantee Corporation for deposits up to Rs 5 lakh. Customers can contact bank officials for more information regarding this. The central bank also said that its orders against color merchants should not be seen as cancellation of banking licenses. He said that the bank will continue to operate with these restrictions until its financial condition improves.
Deputy Governor’s tenure extended for one year
On the other hand, the government extended the tenure of RBI Deputy Governor M Rajeshwar Rao by one year. According to sources, the Appointments Committee of the Cabinet approved the proposal to re-appoint Rao to the post of Deputy Governor of RBI for one year. His new term will start from October 9, 2023. Rao was appointed Deputy Governor of RBI for the first time in October 2020 for three years. Before this he was the Executive Director of RBI.
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