Based in Aurungabad in Maharashtra, Vishwakarma Nagari Sahakari Bank Maryadit(UCB) faces closure, according to a release by the apex bank of the land.
“In view of the fact that Vishwakarma Nagari Sahakari Bank Maryadit, Aurangabad (Maharashtra) had ceased to be solvent and the depositors were being inconvenienced by continued uncertainty, the Reserve Bank of India on September 12, 2013 delivered its order dated September 10, 2013 to the bank cancelling its licence to carry out banking business and the same is effective from the close of business of September 12, 2013”, the release read
The Registrar of Co-operative Societies, Maharashtra State has also been asked to issue an order for winding up of the bank and appoint a Liquidator therefore.
As is the practice, on liquidation, every depositor is entitled to repayment of his/her deposits up to a monetary ceiling of Rupees one lakh from the Deposit Insurance and Credit Guarantee Corporation (DICGC) under usual terms and conditions.
The bank was granted a licence by Reserve Bank of India on October 28, 1999 to commence banking business.
The statutory inspection of the bank carried out on March 31, 2009 revealed that the bank defaulted in maintenance of Cash Reserve Ratio (CRR) and Statutory Liquidity Ratio (SLR) on various occasions and violated Reserve Bank of India guidelines on KYC/AML.
The urban cooperative bank also sanctioned unsecured advances to housing sector in excess of prescribed limits, etc. The quality of management of the bank was not satisfactory. Its continuous negative performance ultimately forced RBI to cancel its licence in public interest.