New Delhi: The Reserve Bank of India (RBI) has placed Laxmi Vilas Bank in the Moratorium on Tuesday. RBI said that he took this decision because he did not have any reliable revival plan. According to the RBI, it has done this in view of protecting the interests of depositors and financial and banking stability. Lakshmi Vilas Bank Limited has been kept in the Moratorium for 30 days. By December 16, the limit of withdrawal of money from the bank has been fixed at 25 thousand rupees.
The Reserve Bank said that there has been a sharp decline in the financial position of Lakshmi Vilas Bank. The bank has seen continuous losses in the last three years, which has reduced its net worth. Further, the lack of any strategic plan, decline in advance and rising NPAs is expected to continue to hurt. RBI also stated that the bank failed to raise sufficient capital to resolve its negative net worth and ongoing losses. Additionally, it has also experienced frequent withdrawal of deposits and low levels of liquidity.
The central bank also emphasized that serious governance cases have come to light in Lakshmi Vilas Bank. And in recent years, his works have reduced his performance. It is worth noting that the bank was placed in the Prompt Corrective Action (PCA) framework in September 2019.
