RBI Extends Operational Restrictions on Konark Urban Co‑operative Bank Until April 23, 2026

The Reserve Bank of India has extended the operational restrictions placed on The Konark Urban Co‑operative Bank Ltd., Ulhasnagar, for an additional three‑month period. These restrictions were originally imposed under Section 35A read with Section 56 of the Banking Regulation Act, 1949, through a directive issued on April 23, 2024.

They were subsequently extended multiple times, with the last extension valid until the close of business on January 23, 2026. The RBI has now determined that continuation of the directive is necessary in the public interest.

Background Of the Original Directive

The initial directive, issued on April 23, 2024, had placed operational restrictions on the bank for a period of six months. These restrictions were implemented under statutory powers available to the RBI to safeguard depositor interests and maintain financial stability.

The period was later extended up to October 23, 2024, and again to January 23, 2026. Each extension reflected the regulator’s ongoing assessment of the bank’s operational and financial conditions.

RBI’s Decision to Extend the Directive

The RBI has now extended the directive from the close of business on January 23, 2026, to the close of business on April 23, 2026. This extension has been applied under sub‑section (1) of Section 35A read with Section 56 of the Banking Regulation Act, 1949.

The extension is subject to review, indicating that the RBI will continue to monitor the bank’s situation closely. The decision underscores the regulator’s view that the extension is in the public interest.

Clarification On Financial Position and Implications

The RBI has clarified that the extension should not be interpreted as implying satisfaction with the financial position of the bank. The continuation of restrictions therefore, does not signal an improvement in the bank’s health.

Instead, it highlights that efforts to stabilise the institution are ongoing and require further time. Depositors and stakeholders are advised to note that the regulatory stance remains unchanged.

Read More: RBI Governor Stresses Governance and Asset Quality Standards for Urban Co-operative Banks.

Conclusion

The extension of the directive on The Konark Urban Co‑operative Bank Ltd. reinforces the RBI’s cautious approach in handling entities under regulatory stress. With the new validity now stretching to April 23, 2026, the bank continues under restricted operations while being subject to ongoing review.

The regulator has emphasised that the extension does not imply satisfaction with the bank’s financial status. Stakeholders can expect further updates based on the RBI’s assessment.

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