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finance | IST

Liquidity not an issue at LVB; Clix loan book had issues: LVB director

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The RBI last night imposed a moratorium on Lakshmi Vilas Bank till December 16, and restricted withdrawals to Rs 25,000 per person irrespective of number of accounts held. Shakti Sinha, Director at Lakshmi Vilas Bank spoke to CNBC-TV18 on the development.

The RBI last night imposed a moratorium on Lakshmi Vilas Bank till December 16, and restricted withdrawals to Rs 25,000 per person irrespective of number of accounts held. Shakti Sinha, Director at Lakshmi Vilas Bank spoke to CNBC-TV18 on the development.
“Liquidity position of the bank is very comfortable, liquidity is not the issue,” he told the channel.
The bank has been making continuous losses for 12 quarters and its capital adequacy has gone into negative territory, he added.
On Clix Capital deal, he said, “There were substantial differences on the two sides that could not be bridged. Clix is a non-banking phenomenon, it works on a different set of rules and a bank has to be governed by the banking regulations and the Reserve Bank of India (RBI) requirements.”
“Also, the loan book of Clix had issues with large number of unsecured creditors and the quality of collateral and legal requirements etc would not be banking compliant,” he added.
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