Document title: Directions under Section 35 A read with Section 56 of the Banking Regulation Act, 1949 – The Tiruvalla Urban Co-operative Bank Ltd., Tiruvalla, Pathanamthitta
Issuing authority: Reserve Bank of India
Reference number: Directive Ref. No. TVM.DOS.SED.No.S485/12-04-221/2026-2027
Date: October 08, 2026
Banking and Credit
The Reserve Bank of India has directed that, as of the close of business on October 08, 2026, Tiruvalla Urban Co-operative Bank Ltd. shall not, without prior written RBI approval, grant or renew any loans and advances, make any investment, incur any liability including borrowing of funds, accept fresh deposits, disburse or agree to disburse any payment, enter into any compromise or arrangement, or sell, transfer or otherwise dispose of any of its properties or assets, except as specifically notified in the RBI Direction dated October 07, 2026. The bank is also prohibited from allowing withdrawals of any amount from savings, current or any other depositor accounts; it may only set off loans against deposits subject to the conditions stated in the Directions. Expenditure on essential items such as employee salaries, rent, electricity bills and similar costs is permitted as specified in the Directions.
Financial Stability and Inclusion
Depositors of the bank are entitled to claim deposit insurance coverage up to a monetary ceiling of ₹5,00,000 (Rupees five lakh only) per depositor from the Deposit Insurance and Credit Guarantee Corporation (DICGC) under the DICGC Act, 1961, upon submission of willingness and verification. Information on the claim process is available on the DICGC website. The RBI clarifies that the issuance of these Directions does not constitute cancellation of the bank’s licence; the bank will continue to undertake banking business subject to the imposed restrictions until its financial position improves. The Directions will remain in force for a period of six months from October 08, 2026 and are subject to review based on the bank’s evolving situation.
Regulatory and Policy Measures
The RBI exercised powers vested under sub‑section (1) of Section 35 A read with Section 56 of the Banking Regulation Act, 1949, to issue the Directions (Directive Ref. No. TVM.DOS.SED.No.S485/12-04-221/2026-2027). The central bank had previously engaged with the bank’s Board and senior management to improve its functioning, but the lack of concrete remedial actions prompted the current restrictive measures. The RBI will continue to monitor the bank’s position and may modify the Directions as warranted, always in the interest of the depositors.
The directive reflects RBI’s proactive supervisory stance to safeguard depositor interests and maintain stability in the cooperative banking segment while providing a clear timeframe and mechanism for potential relief.