Government approves merger of Lakshmi Vilas Bank with DBS Bank, relief to 20 lakh account holders and 4000 employees

New Delhi, 25 November 2020 Wednesday

The government has taken an important decision to allow Lakshmi Vilas Bank to merge with Development Bank of India Limited (DBIL). Cabinet Minister Prakash Javadekar (Prakash Javadekar) said that Laxmivilas Bank has 20 lakh account holders, they will get security. Now they can remove it whenever they want. He said the jobs of 4,000 employees of Lakshmi Vilas Bank would also be secured.

After the Union Cabinet meeting, Union Minister Prakash Javadekar held a press conference and informed about the decisions of the Cabinet. Javadekar said the Union Cabinet had approved the proposal to merge the troubled Lakshmi Vilas Bank into the Development of India Limited. As well as FDI in ATC is also allowed.

Javadekar said the RBI has ordered Lakshmi Vilas Bank to merge with Development Bank of India Limited. This will provide relief to 20 lakh depositors. At the same time, the jobs of 4000 employees will also be maintained. He said the government had told the RBI that the culprits who had sunk the bank should be punished. He said that the board of Lakshmi Vilas Bank has been removed, this is the only way to clean up the banking system.

The Reserve Bank of India on November 17 placed South India-centric Lakshmi Vilas Bank in a one-month moratorium. The RBI had directed the bank that no customer would be able to withdraw more than Rs 25,000 from the bank for the next one month. The impact of the RBI's decision is also being felt on bank shares.

Rs 5 lakh can be withdrawn from the bank in case of emergency. This amount can be withdrawn for treatment, marriage, education and other necessary works, but for that the customers have to provide proof.

Union Minister Prakash Javadekar briefed the press on the cabinet decisions. It may be mentioned that the Reserve Bank had ordered the merger of Lakshmi Vilas Bank with DBS Bank. The Cabinet has approved foreign direct investment (FDI) of Rs 2,480 crore in ATC Telecom Infra. ATC Pacific Asia has acquired a 12 per cent stake in Tata Group company ATC.

He said that many important decisions have been taken in today's meeting of the Cabinet and Cabinet Committee on Economic Affairs (CCEA) chaired by the Prime Minister. He said the Modi government's emphasis is on promoting a self-reliant India. So the debt market will now be taken advantage of to raise money for it.