The central government has imposed a number of restrictions on Laxmi Vilas Bank of the private sector on Wednesday. After these restrictions, the customers of the bank will face trouble. Now account holders can only withdraw up to 25 thousand rupees from their account. RBI said in the statement that the situation of the Lakshmi Vilas Bank crisis was going bad for the last 3 years. During this time the bank has incurred continuous losses. The bank had a net loss of Rs 396.99 crore for the quarter ended September 30. At the same time, its gross NPA ratio was 24.45 percent.
According to the news of Times of India, the bank had been struggling with capital crisis for a long time and good investors were being sought for this. According to the data, the bank had a total deposit of Rs 21,161 crore in the June quarter. After these situations, RBI recently took over the responsibility of this bank. The RBI formed a three-member committee to run the bank.
The Reserve Bank has said that DBIL will generate additional capital of Rs 2,500 crore from the merger. DBIL is a subsidiary of DBS Bank Limited Singapore. The balance sheet of DBIL is quite strong. It had a capital of Rs 7,109 crore as on 30 June 2020. GNPAs and NNPAs were 2.7% and 0.5% respectively.
“Combined balance sheet of DBIL will also remain strong after the proposed merger due to good level of capital,” RBI said. The central bank has asked the depositors and creditors of LVB and DBIL that if they have any advice or objection. Please register. The draft scheme has also been sent to both banks. Advice and objection can be given till 5 pm on 20 November. The Reserve Bank has said that a final decision will be taken thereafter.
The central bank said, “Laxmi Vilas Bank Limited (Bank) ‘s financial position has been continuously deteriorating over the last three years and has been incurring losses for three consecutive years, destroying its net worth. In the absence of any viable strategic plan, declining advances and increasing NPAs, losses are expected to continue. ”