No withdrawing of funds! RBI imposes restrictions this bank - Do you have account in it?

The RBI on Wednesday barred customers of Thodupuzha Urban Co-operative Bank, Kerala, from withdrawing funds as part of several restrictions imposed on the lender due to its deteriorating financial condition.

The Reserve Bank, in a statement said the restrictions on the bank came into force from the close of business on Tuesday.

"Considering the bank's present liquidity position, no amount from the total balance across all savings bank or current accounts or any other account of a depositor, may be allowed to be withdrawn, but are allowed to set off loans against deposits...," it said.

The restrictions will remain in force for six months from the close of business on August 23, 2022.

The bank, without prior approval of RBI, cannot grant or renew any loans, make any investment, and accept fresh deposits. 

The Reserve Bank also said the directions to the co-operative bank should not per se be construed as a cancellation of a banking license by RBI.

The bank will continue to undertake banking business with restrictions till its financial position improves, it said.