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RBI has placed PMC Bank under Directions

Published on September 25, 2019
Current context: The Reserve Bank of India has placed the Punjab and Maharashtra Cooperative (PMC) Bank Limited under Directions.
RBI has placed PMC Bank under Directions
  • As per the Directions, the depositors of the Mumbai based PMC Bank are not allowed to withdraw amount exceeding Rs 1,000 of the total balance in a savings account/current account or deposit account.
  • Other restrictions put on the PMC Bank by RBI are:
    • The bank cannot grant or renew any loans and advances.
    • Can’t make any investment.
    • Can’t incur liability including borrowal of funds.
    • Can’t do acceptance of fresh deposits, without prior approval in writing from the Reserve Bank.
    • Not be able to disburse or agree to any payment towards its liabilities and obligations.
    • Enter into any compromise or arrangement.
    • Sell, and transfer or dispose of any of its properties or assets.
  • The directions are to remain in force for 6 months from the close of business of the bank.
  • RBI has said that the direction is not be construed as a cancellation of a banking licence.

Question: 

Q.1 Which bank has been recently put under Directions by the RBI?
a. Allahabad Bank
b. Punjab National Bank
c. Bank of Baroda
d. Punjab and Maharashtra Cooperative Bank
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