Case Brief
What Happened
The Reserve Bank of India extended the existing Section 35A directions applicable to Sri Satya Sai Nagrik Sahakari Bank Maryadit, Bhopal (M.P.) for six months, from October 09, 2014 to April 08, 2015, subject to review. The bank continues to operate under substantial restrictions: it cannot grant or renew loans and advances, make investments, incur liabilities including borrowings and acceptance of fresh deposits, disburse payments, enter compromises or arrangements, or sell/transfer/dispose of assets except as specifically allowed in the directions. Depositors may withdraw only up to Rs 1,000 per account, subject to conditions. RBI stated that the directions are not to be construed as cancellation of the bank’s licence and that the restrictions would remain until the bank’s financial position improves or RBI modifies the directions.