Recorded RBI impact
Extension
Business restriction · Extension
Published by RBI
24 Sept 2020
Case Brief
The Reserve Bank of India extended the validity of the existing directions issued to Shri Anand Co-operative Bank Ltd., Chinchwad, Pune, Maharashtra. The directions, originally placed from close of business on June 25, 2019 and last extended up to September 24, 2020, will now continue from September 25, 2020 to December 24, 2020, subject to review. The release notes that the other terms and conditions of the directive remain unchanged and clarifies that the extension should not be construed as RBI being satisfied with any substantive improvement in the bank's financial position.
Why RBI Acted
RBI stated that the directions originally issued to Shri Anand Co-operative Bank Ltd. on June 21, 2019, and last extended up to September 24, 2020, shall continue to apply for a further three months from September 25, 2020 to December 24, 2020. The release says the directions are under Section 35A read with Section 56 of the Banking Regulation Act, 1949 (as applicable to co-operative societies), with other terms and conditions unchanged and subject to review.
Operating Impact
The bank remains under the same RBI operating constraints during the extension period, with the directive continuing to govern its activities until December 24, 2020 unless further modified. Customers and counterparties are affected indirectly through the ongoing restrictions, while the bank must continue complying with the existing conditions.
Regulatory Basis
- Section 35 A of the Banking Regulation Act, 1949
- Section 56 of the Banking Regulation Act, 1949
Action Facts
- Primary Impact
- Extension
- Order Date
- 22 Sept 2020
- Effective From
- 25 Sept 2020
- Entities Affected
- 1
- Entity Role
- Primary
- Entity Type
- Co-operative bank