The Reserve Financial institution of India (RBI), Monday cancelled the licence of Kolhapur-based Shankarrao Pujari Nutan Nagari Sahakari Financial institution Restricted, Ichalkaranji and requested the financial institution to not stick with it any banking enterprise, with impact from the shut of enterprise on December 4, 2023.
“Shankarrao Pujari Nutan Nagari Sahakari Financial institution Restricted, Ichalkaranji, Kolhapur is prohibited from conducting the enterprise of ‘banking’ which incorporates, amongst different issues, acceptance of deposits and reimbursement of deposits as outlined in Part 5(b) learn with Part 56 of the Banking Regulation Act, 1949 with instant impact, the Reserve Financial institution mentioned.
The apex financial institution mentioned the Shankarrao Pujari Nutan Nagari Sahakari Financial institution doesn’t have ample capital and incomes prospects. As such, it doesn’t adjust to the provisions of Part 11(1) and Part 22 (3) (d) learn with Part 56 of the Banking Regulation Act, 1949.
The banking regulator additionally mentioned the co-operative financial institution has did not adjust to sure sections of the Banking Regulation Act, 1949.
The Reserve Financial institution additional mentioned the general public curiosity can be adversely affected if the United India Co-operative Financial institution is allowed to hold on its banking enterprise any additional because the financial institution with its current monetary place can be unable to pay its current depositors in full.
On liquidation, the Reserve Financial institution mentioned that each depositor can be entitled to obtain deposit insurance coverage declare quantity of his/her deposits as much as a financial ceiling of ₹5,00,000 from Deposit Insurance coverage and Credit score Assure Company (DICGC) topic to the provisions of DICGC Act, 1961. As per the information submitted by the financial institution, 99.85% of the depositors are entitled to obtain the complete quantity of their deposits from DICGC.
The RBI additional mentioned as of July 24, DICGC has already paid ₹41.60 crore of the overall insured deposits beneath the provisions of Part 18A of the DICGC Act, 1961 primarily based on the willingness obtained from the involved depositors of the financial institution.
The RBI has directed the Commissioner for Cooperation and Registrar Cooperative Societies, Maharashtra to concern an order for winding up the financial institution and appoint a liquidator for the financial institution.
Earlier within the day, the Reserve Financial institution imposed financial penalties on 4 co-operative banks for deficiencies in regulatory compliance. These co-operative banks are: Jijamata Mahila Sahakari Financial institution Ltd, Shri Laxmikrupa City Co-operative Financial institution Ltd, The Konark City Cooperative Financial institution Ltd and The Chembur Nagarik Sahakari Financial institution Ltd.
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Revealed: 04 Dec 2023, 10:37 PM IST
Supply: Live Mint