The Reserve Bank of India (RBI) has restrained Bandhan Bank from opening new branches and also ordered freezing of remuneration of its CEO Chandra Shekhar Ghosh for not meeting the licensing conditions, the bank said on Friday.

The bank said it is taking all steps to comply with licensing condition to bring down the shareholding of non-operative financial holding company (NOFHC) in the bank to 40 per cent. The bank is unable to meet this condition so far and the CBI acted swiftly to stop its opening of new branches.

“RBI has communicated to us that since the bank was not able to bring down the shareholding of NOFHC to 40 per cent...general permission to open new branches stands withdrawn and the bank can open branches with prior approval of RBI and the remuneration of the MD & CEO of the bank stands frozen at the existing level, till further notice," it said. "The bank said it is taking steps to comply with licensing condition to bring down the shareholding of NOFHC in the bank to 40 per cent,” said Bandhan Bank.

According to the bank's website, it has 937 branches in parts of the country. Bandhan, an MFI, was given conditional approval by the RBI for setting up a universal bank in April 2014. The bank became operational in 2015 and it has headquarters in Kolkata.