RBI Intervenes in Co-operative Banks Amid Governance Concerns

The Reserve Bank of India (RBI) has taken bold action by replacing the Board of Directors at Irinjalakuda Town Co-operative Bank, citing persistent financial distress and governance issues.

This move comes with a one-year tenure for the appointed Administrator, Raju S Nair, a former Vice President at Federal Bank, who will steer the bank's operations during this period. In support, a Committee of Advisors, featuring experienced figures like Mohanan K and TA Mohamed Sageer, will assist in overseeing the bank's recovery.

With previous restrictions already affecting Irinjalakuda, Samarth Urban Co-operative Bank Ltd., and Samarth Sahakari Bank due to liquidity issues, the RBI aims to stabilize these financial institutions in the face of difficulty.

(With inputs from agencies.)