The Reserve Bank of India has lifted the Supervisory Action Framework (SAF) imposed on 15 Urban Cooperative Banks (UCBs) in Gujarat, signalling a positive shift in their financial health and regulatory compliance.
The move reflects the central bank’s confidence in the improved performance and risk management practices of these institutions, which had previously been under close watch due to financial stress or operational concerns.
With the withdrawal of restrictions, these banks can now operate without the constraints that come with being under SAF, including limitations on lending, branch expansion, and dividend distribution. This development is likely to enhance their operational freedom, strengthen customer trust, and open avenues for future growth.
Gujarat, which houses 211 urban cooperative banks, has demonstrated resilience in this sector with total deposits amounting to Rs 54,000 crore and advances nearing Rs 41,000 crore. The collective gross NPA of these banks stands at 3.5 per cent, while net NPA has been reduced to a low of 0.5 per cent—indicating robust asset quality and prudent banking practices.
This development underscores the importance of sustained efforts towards governance reforms, capital adequacy, and adherence to regulatory standards, and is expected to inspire similar progress across other states with SAF-listed cooperative banks.
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