The Reserve Bank of India (RBI) has allowed District Central Co-operative Banks (DCCB) to close their unremunerative branches without prior permission of the central bank.

However, the approval from the Registrar of Cooperative Societies of the respective state will be needed.

The decision to close down branches should be taken by the board after taking into account all the relevant factors and should be properly recorded/minuted in the proceedings of the board meeting, the RBI today said in a circular.

"The bank should give two months’ notice in advance to all existing depositors/ clients of the branch through press release in local leading newspapers as well as communicate to each constituent of the branch, well in advance of the closure of the branch," the central bank said.

Also, the DCCB should return the original licence/s issued for the closed branch to the regional office concerned of the Reserve Bank.

However, DCCBs will not be allowed to close branches if restrictions have been imposed on the bank by the RBI.

In another circular, the RBI laid down the procedure to be followed for change in the name of co-operative banks.