The rescue act

Yet another financial institution has failed and is being rescued. The Reserve Bank of India (RBI) on Tuesday proposed to merge Lakshmi Vilas Bank (LVB) with the Indian subsidiary of Singapore-based DBS Bank. LVB was also placed under a moratorium by the government for a month and depositors would be allowed to withdraw only Rs 25,000 during this period. According to the plan, the entire paid-up share capital, and reserves and surplus of LVB will be written off. However, the interests of depositors and employees will be protected. In the end, this might look like a smooth process, where the