We have been advised by Reserve Bank of India that in exercise of powers conferred by sub-section (2) of section 45 of the Banking Regulation Act, 1949, the Government of India have issued an order of moratorium dated 24th July, 2004, in respect of our bank for the period from the close of business on 24th July, 2004, up to and inclusive of 23rd October, 2004. 
 
Further, Reserve Bank of India in exercise of the powers conferred under Section (1) 36 AB of the Banking Regulation Act, 1949, have appointed Sri R V Ivyer and Sri G Padmanabhan as RBI nominee directors on the board of our bank. 
 
We have therefore suspended the operations of ATMs in the interim and we regret the inconvenience caused to customers. We also request the customers to contact head of their branch for further guidance.

-- Global Trust Bank Ltd

Chronology of a crisis   

• Reserve Bank of India audit of Global Trust Bank's books as on March 31, 2002, reveals a negative net worth. This is despite the bank's audited numbers showing a net worth of Rs 400 crore (Rs 4,000 million) and a net profit of Rs 40 crore (Rs 400 million).
• In March 2003, PricewaterhouseCoopers in its audit report for the year ending March 31, 2003, qualified the status of GTB as a going concern in unequivocal terms in the notes to the accounts of the bank. GTB junks PwC as auditor.
• RBI reins in GTB, issues diktat curbing activities relating to capital market exposure, declaration of dividend, advances and withdrawal of deposits.
• Mint Road decides to monitor GTB on a monthly basis. Suggests change in the bank's auditors for the financial year 2002-03. In order to facilitate this, the bank is permitted time till September 30, 2003, to publish accounts.
• The bank hobbles back to normal but income generation is not enough to offset the millstone of provisioning.
• Sept 30, 2003: RBI welcomes the decision by the bank to clean up its balance sheet. Says even though the financial statement shows an overall loss, the bank has made an operating profit for 2002-03.
• Question marks again crop up about the same set of accounts. GTB reports a marginally positive net worth but the RBI decides to inspect the numbers with a fine tooth comb and finds that net worth was plunging and the capital adequacy ratio had turned negative.
• November 2003: GTB is told to inject fresh capital through domestic sources or through a merger so that its capital adequacy ratio is pumped up to the stipulated 9 per cent. The RBI asks the bank to draw up a schedule to achieve this.
• July 2004: RBI rejects GTB's funds infusion and restructuring plan. Applies to Centre to place the bank under moratorium for three months with effect from July 25.