According to a press release, the commissioner and registrar for cooperation co-operative societies, Maharashtra It has also been requested to issue an order to close the bank and appoint a liquidator for the bank.
“Consequent to the cancellation of its licence, the “Rupee Sahakari Bank Ltd., Pune” is prohibited from carrying on the business of ‘Banking’ which shall include, inter alia, the acceptance of deposits and repayment of deposits as defined in section 5(b) read with section 56 of the banking regulation act1949 with effect from 22nd September, 2022,” the RBI press release said.
The central bank cited the following reasons for canceling the licence:
- The bank does not have sufficient capital and earning potential. Thus, it does not comply with the provisions of Section 11(1) and Section 22(3)(d) read with Section 56 of the Banking Regulation Act, 1949.
- The bank has failed to comply with the requirements of sections 22(3)(a), 22(3)(b), 22(3)(c), 22(3)(d) and 22(3)(e) . read with section 56 of the Banking Regulation Act, 1949;
- The continuance of the bank is prejudicial to the interests of its depositors
- the bank will be unable to make full payments to its existing depositors with its current financial position; And
- Public interest will be adversely affected if the bank is allowed to carry forward its banking business.
RBI has directed the bank to provide every eligible depositor the full amount of their deposits DICGC, It said, “every depositor shall be entitled to receive” deposit Insurance The claim amount from deposit insurance up to the monetary limit of ₹ 5,00,000/- (Rupees five lakh only) and credit guarantee corporation (DICGC) on liquidation.”
As on May 18, 2022, DICGC has already paid ₹700.44 crore of the total insured deposits under the provisions of section 18A of the DICGC Act, 1961 based on the request received from the concerned depositors of the bank.