Depositors of Sri Guru Raghavendra Sahakara Bank say they are worried about their money
BJP MP Tejasvi Surya has sought to calm down panicked depositors of a co-operative bank in Bengaluru after the Reserve Bank of India (RBI) restricted the bank from doing business with immediate effect and capped withdrawal limit at Rs 35,000.
"I want to assure all depositors of Sri Guru Raghavendra Co-operative Bank to not panic. Hon'ble Finance Minister Smt. @nsitharaman is appraised of matter & is personally monitoring the issue. She has assured Govt will protect interests of depositors. Grateful for her concern," Mr Surya tweeted on Monday.
Bengaluru-based Sri Guru Raghavendra Sahakara Bank has some 9,000 depositors.
"...As from the close of business on January 10, 2020, the aforesaid bank shall not... grant or renew any loans and advances, make any investment... In particular, a sum not exceeding Rs 35,000 of the total balance in every savings bank or current account or any other deposit account may be allowed to be withdrawn subject to conditions..." the RBI said in a statement uploaded on its website.
The central bank said the licence of the Bengaluru bank has not been cancelled, and it can continue to "undertake banking business with restrictions till its financial position improves".
Thousands of angry depositors crowded an auditorium in Bengaluru on Monday to seek clarification on the safety of their deposits. The bank had invited them to assemble there for a briefing, news agency IANS reported.
"The bank is telling that I cannot withdraw more than Rs 35,000. In case our fixed deposit matures, we have to renew it as we cannot encash it," said Nagaraj M, 49, an account holder with the bank for the last six years.
"We want the directors of the bank here," a depositor shouted from the stage.
The bank's chairman K Ramakrishna said the depositors' money is "one hundred per cent safe". "Your money is 100 per cent safe with Sri Guru Raghavendra Sahakara Bank. It is my responsibility," Mr Ramakrishna said in the auditorium, according to IANS.
The crisis at the Bengaluru bank unfolded months after a similar lender, Punjab and Maharashtra Co-operative (PMC) Bank, imposed withdrawal limit following an order from the RBI. A police case was filed after promoters of the crisis-hit real estate firm Housing Development and Infrastructure Ltd (HDIL) allegedly defaulted on loans to PMC Bank worth up to Rs 4,300 crore.
(With inputs from IANS)