RBI Reconstitutes Committee of Advisors of the Abhyudaya Cooperative Bank

Current context: The Reserve Bank of India (RBI) has reconstituted the Committee of Advisors of the Abhyudaya Cooperative Bank.

• This decision was made following the resignation of Shri Mahendra Chhajed from the Committee for personal reasons, effective from March 4, 2024.
• The reconstituted Committee of Advisors now includes:
• Shri Devendra Kumar, former Chief General Manager, SBI.
• Shri Venkatesh Hegde, former General Manager, SBI.
• Shri Suhas Gokhale, former MD, COSMOS Co-operative Bank Limited.
• This committee is expected to assist the Administrator, Shri Satya Prakash Pathak, in managing the affairs of the bank.
• The RBI had superseded the board of Abhyudaya Cooperative Bank due to concerns about “poor governance” and appointed an administrator to manage the affairs of the lender.
• The bank was allowed to continue its normal banking activities.

Question:

Q.1 Why did the RBI supersede the board of the Abhyudaya Cooperative Bank?
a. Due to financial fraud
b. Due to poor governance
c. Due to bankruptcy
d. Due to a change in management