Customers gather outside SGRSBN bank as RBI restricts co-op bank’s operations

Bengaluru: Hundreds of customers gathered outside Sri Gururaghavendra Sahakara Bank Niyamitha (SGRSBN), a co-operative bank in Bengaluru’s Basavanagudi on Monday, January 12 after RBI issued a notice restricting the bank’s operations from Saturday.

The Reserve Bank of India (RBI) had curbed a Bengaluru-based private co-operative bank from doing business with immediate effect for alleged irregularities in transactions.

“Sri Guru Raghavendra Sahakara Bank in Bengaluru shall not, without prior approval of the RBI in writing, grant or renew loans and advances, make investment, borrow funds or accept fresh deposits from January 10, 2020,” the RBI said in a directive was quoted speaking to IANS.

The central bank’s Chief General Manager Yogesh Dayal issued the directive under Sections 35A and 56 of the Banking Regulation Act, 1949, from Mumbai. The RBI, however, allowed the bank’s savings and current account customers and depositors to withdraw cash up to Rs 35,000 only till further notice.

“The private bank will also not disburse payment whether in discharge of its liabilities and obligations or otherwise, enter into compromise or arrangement and sell, transfer or otherwise dispose its properties or assets except, as instructed on January 2, 2020,” said the directive.