RBI places Lakshmi Vilas Bank under moratorium

After the Punjab and Maharashtra Bank (PMC) episode last September, when the RBI placed the bank under directions and capped deposit withdrawals, the once-fancied private sector bank, YES Bank ran into trouble in March this year.

Daily Current Affairs Quiz 2020

Key-Points

The RBI had placed restrictions on the withdrawal of the bank’s deposits for about two weeks.

The financial position of LVB has been deteriorating sharply over the past two to three years. The bank has been making losses over the last three years, owing to a sharp rise in bad loans and provisions. This has led to steep erosion in profit and capital.

Depositors of LVB will ideally become customers of DBS Bank. Singapore-based DBS Bank will strengthen its India business with the acquisition of LVB.

DBS Bank Ltd is a Singaporean multinational banking and financial services corporation headquartered in Singapore.

The company was known as The Development Bank of Singapore Limited, before the present name was adopted on 21 July 2003 to reflect its changing role as a global bank.

Events over the past year have rattled depositors. After the Punjab and Maharashtra Bank (PMC) episode last September, when the RBI placed the bank under directions and capped deposit withdrawals, the once-fancied private sector bank, YES Bank ran into trouble in March this year.

The RBI had placed restrictions on the withdrawal of the bank’s deposits for about two weeks.