RBI Action: In the information given by the Reserve Bank, it was told that according to the bank’s data, 87 percent of the depositors are entitled to get their deposits in full from DICGC.
City Co-Operative Bank: Strict action is being taken against banks by the Reserve Bank of India (RBI). After cancelling the license of a bank located in UP two days ago, RBI canceled the license of another bank on Wednesday. The bank has stopped functioning from June 19, 2024. That is, those who go to the bank on the morning of June 20 will not be able to withdraw their money from the account. This time the license of City Co-operative Bank Limited of Mumbai has been canceled by the central bank.
Entitled to get up to Rs 5 lakh from DICGC
In the information given by RBI, it was told that the Cooperative Commissioner and Registrar of Maharashtra has also been asked to issue an order to close the bank and appoint a liquidator for it. On closure of the bank, every account holder will be entitled to receive deposit insurance claim amount of his deposits up to a limit of Rs 5 lakh from the Deposit Insurance and Credit Guarantee Corporation (DICGC).
Rs 231 crore already paid
The Reserve Bank said, ‘According to the bank’s data, about 87 percent of the depositors are entitled to receive the full amount of their deposits from DICGC.’ DICGC has already paid Rs 230.99 crore out of the total insured deposits based on the wishes received from the respective depositors of the bank till June 14, 2024. The Reserve Bank said that the Mumbai-based cooperative bank does not have adequate capital and earning prospects.
If the bank continues to function, people will be adversely affected
The central bank said, with its current financial position, the bank will be unable to make full payments to its account holders. If the bank is allowed to continue its operations further, it will have an adverse effect on the people. As a result of the cancellation of its license, City Co-operative Bank has been prohibited from doing the business of a bank, which, among other things, includes accepting deposits and repayment of deposits.
Co-operative Bank Limited’s license canceled two days ago
Just two days ago, RBI has canceled the license of Purvanchal Co-operative Bank Limited. On the basis of RBI’s investigation report last year in a case related to the bank, former promoter of Purvanchal Co-operative Bank Limited Ram Babu Shandilya, Managing Committee, Auditor M/s Vijay K. A case was filed against Sharma & Company, bank proprietor, former CEO Vivek Pandey and related parties and firms on 30 August 2023. The central bank has refunded Rs 12.63 lakh crore to 912 account holders who deposited less than Rs 5 lakh in Purvanchal Co-operative Bank. Apart from this, the process of refunding Rs 22.92 crore to 1691 account holders is going on.
