Banking regulator, Reserve Bank of India has received stay order from Supreme Court against Udhna Citizens Cooperative Bank. This stay order comes in response to the stay order which was issued by Gujarat high court for a petition registered by the Cooperative bank against RBI for imposing restrictions in its operations as per Sec 35 (A) of Banking Act.
The high court had put a stay order on RBI imposing its restrictions till November 16, 2010.
Setu Madhavan, chairman, Udhna Citizens Cooperative Bank, said, "The RBI wanted to prove that it was above us and hence has obtained a stay. However, the high court is scheduled to hear the case on November 16. We will prove that we have enough liquidity and are in a good shape and that the RBI decision is wrong."
As per the bank, it has liquidity worth Rs 52.23 crore as on 2 November and deposits amount to Rs 95 crore. But RBI data says the NPA level of the bank is touching 76% which is not acceptable.