The cash-strapped Lakshmi Vilas Bank will be effectively
merged with DBS Bank India Limited (DBIL) on November 27, and with it come out of the moratorium imposed on it last
week, the Reserve Bank of India said on Wednesday.

The RBI issued the statement within hours of the Cabinet
clearing the Scheme of Amalgamation of Lakshmi Vilas Bank Limited (LVB) with
DBS Bank India Limited (DBIL), PTI reported.

“The amalgamation will come into force on the appointed
date i.e. November 27, 2020. All the branches of the Lakshmi Vilas Bank Ltd.
will function as branches of DBS Bank India Ltd. with effect from this
date,” the RBI said.

“Consequently the moratorium on the Lakshmi Vilas Bank
Ltd. will cease to be operative from that date,” it said.

The central bank had superseded the board of LVB on November
17 taking view of the bank’s financial frailty and depleting reserves. It had
also put a moratorium on the bank capping the limit of cash withdrawals by
customers to Rs 25,000.