OPINION

Govt. may take over banks defying RBI

The Lok Sabha Select Committee on the Banking Laws (Amendment) Bill, 1967 has made it clear that the Central Government may acquire a bank if it fails to comply with the directives of the Reserve Bank of India on more than one occasion. The earlier provision in the Bill gave powers to the Central Government to acquire a bank if it “persistently” failed to comply with the directions of the Reserve Bank. The Committee has also made it clear that the Central Government can acquire a bank only when it fails to comply with the directions of the Reserve Bank in regard to banking policy and not in regard to procedural matters.

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