The Reserve Bank of India imposed monetary penalties on four cooperative banks for various grounds and cancelled the license of Vaishali Sahakari Vikas Cooperative Bank on Monday.
As per the data submitted by the Vaishali Sahakari Vikas Cooperative Bank, 98.47% of the depositors are entitled to receive the full amount of their deposits from DICGC. As on December 05, 2024, DICGC has already paid Rs 5832.80 lakh of the total insured deposits under the provisions of Section 18A of the DICGC Act, 1961 based on the willingness received from the concerned depositors of the bank.
The Reserve Bank of India has requested the Registrar of Cooperative Societies, Bihar to issue an order for winding up the bank and appoint a liquidator for the bank. The Reserve Bank cancelled the licence of the bank as, The bank does not have adequate capital and earning prospects. As such, 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.
Besides, 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 and the continuance of the bank is prejudicial to the interests of its depositors.
The bank with its present financial position would be unable to pay its present depositors in full; and Public interest would be adversely affected if the bank is allowed to carry on its banking business any further.
The penalties were imposed on the Kaithal Central Cooperative Bank, Yavatmal Urban Cooperative Bank, Kolikata Mahila Cooperative Bank and Prime Cooperative Bank worth Rs 15 lakh.
The Reserve Bank of India imposed a monetary penalty of Rs 5.00 lakh on the Kaithal Central Co-operative Bank Ltd., Haryana (the bank) for contravention of provisions of Section 26A read with Section 56 of the Banking Regulation Act, 1949 (BR Act).
A monetary penalty of Rs 5.00 lakh on the Yavatmal Urban Co-operative Bank Limited, Yavatmal, Maharashtra (the bank) for non-compliance with specific directions issued by RBI under ‘Supervisory Action Framework (SAF)’, and certain directions issued by RBI on ‘Exposure Norms & Statutory / Other Restrictions – UCBs’.
Besides, a monetary penalty of Rs 1.00 lakh imposed on the Kolikata Mahila Co-operative Bank Limited (the bank) for contravention of provisions of Section 31 of the Banking Regulation Act, 1949 (BR Act).
The Reserve Bank of India imposed a monetary penalty of Rs 4.00 lakh on the Prime Co-operative Bank Ltd., Surat, Gujarat (the bank) for non-compliance with the directions issued by RBI on ‘Customer Protection – Limiting Liability of Customers of Co-operative Banks in Unauthorised Electronic Banking Transactions’ and ‘Basic Cyber Security Framework for Primary (Urban) Cooperative Banks (UCBs)’ read with ‘Comprehensive Cyber Security Framework for Primary (Urban) Cooperative Banks (UCBs) – A Graded Approach’.
