RBI Cancels License of Co-operative Bank Ltd; Check Name of the Bank

The Reserve Bank of India (RBI) vide order dated July 01, 2022, has cancelled the license of “Shri Anand Co-operative Bank Ltd., Chinchwad, Pune”. Consequently, the bank ceases to carry on banking business, with effect from the close of business on July 07, 2022. 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 Reserve Bank cancelled the license of the bank as:

i. The bank lacks sufficient capital and earning potential. As a result, it doesn’t adhere to the rules of Sections 11(1) and 22(3)(d) read in conjunction with Section 56 of the Banking Regulation Act, 1949.

ii. The bank has not complied with Sections 22(3)(a), 22(3)(b), 22(3)(c), 22(3)(d), and 22(3)(e) of the Banking Regulation Act, 1949, read with Section 56;

iii. The interests of the bank’s depositors are harmed by the bank’s continued existence;

iv. The bank with its present financial position would be unable to pay its present depositors in full; and

v. Public interest would be adversely affected if the bank is allowed to carry on its banking business any further.

2. Shri Anand Co-operative Bank Ltd., Chinchwad, Pune is immediately forbidden from engaging in 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, as a result of the cancellation of its license.

3. Each depositor is entitled to receive a deposit insurance claim amount from the Deposit Insurance and Credit Guarantee Corporation (DICGC) upon liquidation, up to a maximum of Rs. 5,00,000 (Rupees five lakh only), subject to the requirements of the DICGC Act, 1961. More than 98% of depositors are eligible to retrieve the full value of their deposits from DICGC, according to data provided by the bank. According to Section 18A of the DICGC Act, 1961, DICGC has already paid out 9.42 crore of the total insured deposits as of May 18, 2022, depending on the expressed willingness of the affected bank depositors.