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      Question

      With reference to the Banking Laws (Amendment) Act,

      2025, consider the following statements: 1. The Act redefines the threshold for ‘substantial interest’ in banks from ₹5 lakh to ₹2 crore. 2. In cooperative banks, the maximum tenure for directors (other than chairperson and whole-time directors) has been raised from 8 years to 10 years, in line with the 97th Constitutional Amendment. 3. Public Sector Banks (PSBs) are now allowed to transfer unclaimed shares and interest to the Investor Education and Protection Fund (IEPF), aligning with Companies Act provisions. Which of the above statements is/are correct?
      A 1 only Correct Answer Incorrect Answer
      B 1 and 2 only Correct Answer Incorrect Answer
      C 2 and 3 only Correct Answer Incorrect Answer
      D 1 and 3 only Correct Answer Incorrect Answer
      E 1, 2 and 3 Correct Answer Incorrect Answer

      Solution

      • Statement 1 – Correct:  The Act updates the definition of ‘substantial interest’, raising the threshold from the old ₹5 lakh (1968 provision) to ₹2 crore, reflecting current economic realities. • Statement 2 – Correct:  For cooperative banks, the maximum tenure for directors (excluding chairperson and whole-time directors) is now 10 years, up from 8, aligning with the 97th Constitutional Amendment, which strengthened cooperative governance. • Statement 3 – Correct:  PSBs can now transfer unclaimed shares and interest to the Investor Education and Protection Fund (IEPF), aligning their practice with that of companies governed under the Companies Act.

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