The Reserve Bank of India (RBI) on Friday superseded the Board of Directors of Mumbai-based Abhyudaya Cooperative Bank Ltd, for a year. This central bank’s action comes as it observed certain material concerns emanating from poor governance standards in the bank.
No business restrictions have been placed by RBI and the bank shall continue to carry on its normal banking activities as is hitherto, under the guidance of the Administrator, as per a central bank statement.
Appointment of Administrator
RBI has appointed Satya Prakash Pathak, former Chief General Manager of State Bank of India, as “Administrator” to manage the affairs of the bank during this period. It also appointed a “Committee of Advisors” to assist the Administrator to discharge his duties.
Also read: RBI takes stock of high attrition in private banks
The members of the “Committee of Advisors” are Venkatesh Hegde (former General Manager, SBI); Mahendra Chhajed (Chartered Accountant); and Suhas Gokhale (former MD, COSMOS Co-operative Bank Ltd).
The RBI superseded the Bank’s board in exercise of the powers conferred on it under the Banking Regulation Act, 1949 (As Applicable to Co-operative Societies).
The multi-state co-operative Bank had deposits and advances aggregating ₹10,952.44 crore and ₹6,711.24 crore, respectively, as of March-end 2021, per the Bank’s balance sheet.