Alwar Urban Co-operative Bank Ltd; Alwar

In exercise of powers under Section 35A of the Banking Regulation Act, 1949 (read with Section 56), RBI issued Directions to Alwar Urban Co-operative Bank Ltd., Alwar effective from the close of business on March 07, 2017. The bank was barred, without prior written RBI approval, from granting or renewing loans and advances, making investments, incurring liabilities including borrowings and acceptance of fresh deposits, disbursing or agreeing to disburse payments, entering into compromises or arrangements, and selling/transferring/disposal of properties or assets, except as provided in the RBI Directions dated March 01, 2017. Withdrawals from accounts were capped at ₹1,000 per savings/current/other deposit account, subject to the stated conditions. RBI clarified that the directions should not be construed as cancellation of banking licence and that the bank would continue to undertake banking business with restrictions until its financial position improves.

The bank must operate under tight RBI-imposed restrictions and cannot independently grow its loan book, raise fresh deposits, or undertake several balance-sheet transactions without prior written approval. Depositors may withdraw only up to the stated limit and subject to conditions, while other banking activities remain constrained until RBI modifies the directions.