Directions under Section 35A read with section 56 of the Banking Regulation Act, 1949 (as applicable to Co-operative Societies) – The Karwar Urban Co-operative Bank Ltd., Karwar

The Reserve Bank of India (RBI) has issued directives to The Karwar Urban Co-operative Bank Ltd., Karwar, under the Banking Regulation Act, 1949. Effective June 12, 2024, the bank is prohibited from granting or renewing loans, making investments, or accepting fresh deposits without RBI approval. \r

Withdrawals from depositor accounts are restricted, but loan offsets are permitted. These measures follow concerns regarding the bank's misreporting of public deposits and assets, inadequate liquidity, and lack of recent audits. Depositors are assured insurance claims up to ₹5,00,000 from DICGC within 90 days. \r

The bank's operations continue under RBI monitoring, with directions subject to review after six months.