RBI Imposes Restrictions on Two UP Based Co-Operative Banks

The Reserve Bank said it has imposed several restrictions, including on fund withdrawals, on two Uttar Pradesh-based cooperative banks in view of their deteriorating financial position.

The two lenders are Lucknow Urban Co-operative Bank and Urban Co-operative Bank Limited, Sitapur. The restrictions under the Banking Regulation Act will remain in force for six months.

Customers of Lucknow Urban Co-operative Bank will not able to withdraw more than Rs 30,000, as per an RBI statement.

The withdrawal limit in the case of Urban Co-operative Bank is Rs 50,000 per customer, it said in another statement.

The two banks, without permission of the RBI, cannot grant loans, make any investment, incur any liability -- including borrowal of funds and acceptance of fresh deposits, disburse or dispose of properties or assets.