RBI Relaxes Withdrawal Limits for New India Cooperative Bank

The Reserve Bank of India has eased restrictions on New India Cooperative Bank, allowing customers to withdraw up to Rs 25,000. This relaxation follows the imposition of All Inclusive Directions that initially banned withdrawals amid supervisory issues. An Administrator and a new Committee of Advisors were appointed to oversee operations.

The Reserve Bank of India has made a significant decision affecting New India Cooperative Bank, relaxing previously imposed restrictions and allowing customers to withdraw up to Rs 25,000 from their accounts. This change comes after the bank faced stringent All-Inclusive Directions due to supervisory issues.

The initial restrictions, put in place on February 13, banned deposit withdrawals as a response to supervisory concerns. As of Monday, the RBI decided to permit a partial withdrawal, effective February 27, which is a relief for many depositors. According to RBI, more than half of the depositors will now be able to access the entirety of their deposited funds.

To ensure smooth operations, the RBI superseded the bank's Board of Directors, appointing Shreekant, a former SBI Chief General Manager, as Administrator. A reconstituted Committee of Advisors now includes experts like Ravindra Sapra and Anand M Golas, ensuring effective management. The RBI emphasized its commitment to monitoring developments and safeguarding depositors' interests.