Dated 1st of July, 2022 the Reserve Bank of India 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 the bank does not have adequate capital and earning prospects.
In its release the RBI noted several provisions of the Banking Regulation Act, 1949, which the UCB was not in a position to follow.
The RBI says the continuance of the bank is prejudicial to the interests of its depositors as the bank with its present financial position would be unable to pay its present depositors in full.
RBI says public interest would be adversely affected if the bank is allowed to carry on its banking business any further.
Consequent to the cancellation of its license, “Shri Anand Co-operative Bank Ltd., Chinchwad, Pune” is prohibited from conducting the business of ‘banking’ which includes, among other things, acceptance of deposits and repayment of deposits as defined in Section 5(b) read with Section 56 of the Banking Regulation Act, 1949 with immediate effect.
On liquidation, every depositor would be entitled to receive deposit insurance claim amount of his/her deposits up to a monetary ceiling of Rs 5,00,000/- (Rupees five lakh only) from Deposit Insurance and Credit Guarantee Corporation (DICGC) subject to the provisions of DICGC Act, 1961.
As per the data submitted by the bank, more than 99% of the depositors are entitled to receive full amount of their deposits from DICGC. As on May 18, 2022, DICGC has already paid ?9.42 crore 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.