RBI cancels license of Maharashtra
based bank
RBI has
canceled the license of Karnala Nagari Sahakari Bank, Panvel in Maharashtra for
not having sufficient capital and unable to make full payment to its existing
depositors.
with effect
from the close of business on August 13, 2021, the RBI said in an official release.
The central
bank further said, "The Commissioner for Cooperation and Registrar of
Cooperative Societies, Maharashtra has also been requested to issue an order
for winding up the bank and appoint a liquidator for the bank."
The Bank
ceased to do banking business with effect from the close of business on 13
August 2021.
95% of the
depositors will get the full amount from the Insurance and Credit Guarantee
Corporation (DICGC).
The licence
of the bank is cancelled as it does not have adequate capital and earning
prospects, RBI said,
adding that the lender has failed to comply with the requirements of various
sections of the Banking Regulation Act, 1949.
Also,
"the bank with its present financial position would be unable to pay its
present depositors in full", it said.
While
announcing cancellation of the licence, RBI said public
interest would be adversely affected if the bank is allowed to carry on its
banking business any further.
Now, Karnala
Nagari Sahakari Bank cannot conduct the business of banking, which includes
acceptance of deposits and repayment of deposits.
The
Commissioner for Cooperation and Registrar of Cooperative Societies,
Maharashtra has also been requested to issue an order for winding up the bank
and appoint a liquidator for the bank.
Meanwhile, in
separate statements, RBI said it has imposed penalty on three cooperative banks for
deficiencies in regulatory compliance.
A penalty of
Rs 25 lakh each has been imposed on Madhya Pradesh Rajya Sahakari Bank
Maryadit, Bhopal, and The Greater Bombay Cooperative Bank Ltd, Mumbai.
RBI has also
imposed a penalty of Rs 50,000 on Jalna People's Cooperative Bank Ltd, Jalna,
Maharashtra.
A penalty of
Rs 25 lakh each has been imposed on Madhya Pradesh Rajya Sahakari Bank
Maryadit, Bhopal, and The Greater Bombay Cooperative Bank Ltd, Mumbai.
RBI has also imposed a penalty of Rs 50,000 on Jalna People's Cooperative Bank
Ltd, Jalna, Maharashtra.
In all the three cases, RBI said the penalties are based on deficiencies in
regulatory compliance and is not intended to pronounce upon the validity of any
transaction or agreement entered into by the cooperative banks
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