Long Term (Subordinated) Deposit Scheme
Member or Non-member of the Bank (including those outside area of operation of the Bank)
Eligible Person to make investment
- Proprietorship firm
- Hindu Undivided Family (HUF), Charitable Trust, Co-op. Society etc. (Except other Central Co-operative Banks in the State of Punjab)
- State Government
- Board and Corporations (under the control of State Government)
Rs.1000/- and thereafter in multiples of Rs.1000/-
66 months (from the date of deposit)
Floating rate which shall be 0.50% above than the rate of interest being offered on term deposits for any slab of FD.
Other Terms & Conditions
- LTD will be subordinated to the claims of depositors and other creditors but would rank senior to the claims of shareholders, including holders of preference shares (both Tier I & Tier II). Among investors of instruments included in lower Tier II, the claims shall rank paripassu with each other.
- LTD will not be eligible for insurance cover from the Deposit Insurance & Credit Guarantee Corporation (DICGC).
- LTD is not a deposit and hence, nomination facility under section 45ZA of the Banking Regulation Act, 1949 (AACS) is not available. However, nomination facility available under the respective co-operative societies act for capital instruments will be applicable.
- No loans will be granted against the security of LTD.
- LTD shall not be issued with a 'put option' or a 'step up' option. The 'call option' will be permissible and may be exercised after 5 years with prior permission of the Reserve Bank. While considering the proposals received from banks for exercising the call option the Reserve Bank would, among other things, take into consideration the bank's CRAR position both at the time of exercise of the call option and after exercise of the call option.
- Payment before due date is not permissible in case of LTD.
- Duplicate deposit receipt will be issued if original is lost by the depositor.
- Tax will be deducted at source from the interest paid as per the extant provisions of Income Tax Act, 1961.
- Deposit receipt is not transferable by endorsement.
- The bank will not recognize any lien, charge or other encumbrance on the deposit.
- In the event of death of subscriber of LTD, instrument shall be transferred in the name of legal heirs as per provisions of Punjab State Cooperative Societies Act, 1961 and in no case the installment shall be liable to be redeemed before due date and shall be payable as per terms and conditions stipulated at para 5 above.
- All disputes/transactions are subject to arbitration under Punjab Cooperative Societies Act 1961.