Reetu | Sep 30, 2023 |
RBI cancels licence of Urban Co-operative Bank
The Reserve Bank of India (RBI) has cancelled the licence of Lucknow Urban Co-operative Bank Ltd., Lucknow, Uttar Pradesh. Consequently, the bank ceases to carry on banking business, with effect from the close of business on September 29, 2023 via order dated September 28, 2023.
The Commissioner and Registrar of Cooperatives in Uttar Pradesh has also been asked to issue an order for the bank’s liquidation and appoint a liquidator.
The Reserve Bank cancelled the licence of the bank as:
With immediate effect, Lucknow Urban Co-operative Bank Ltd., Lucknow, Uttar Pradesh, is prohibited from conducting the business of ‘banking,’ which includes, among other things, accepting deposits and repaying deposits, as defined in Section 5(b) read with Section 56 of the Banking Regulation Act, 1949.
On liquidation, every depositor is entitled to receive the deposit insurance claim amount of his/her deposits up to a monetary ceiling of 5,00,000/- (Rupees five lakh only) from the Deposit Insurance and Credit Guarantee Corporation (DICGC), subject to the provisions of the DICGC Act, 1961. According to the bank’s data, 99.53% of depositors are entitled to the full amount of their deposits from DICGC.
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