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License of United Co-operative Bank Ltd Cancelled

Published on May 16, 2021
Current Context: The Reserve Bank of India (RBI) has announced that it has canceled the license of the United Co-operative Bank Ltd, Bagnan in West Bengal.
License of United Co-operative Bank Ltd Cancelled
  • The license was canceled as the bank is inadequate of the fund and earning prospects. So it was not able to pay its present depositors in full.
  • Also, the United Co-operative Bank Ltd was not in compliance with the provisions of section 11(1) and section 22(3) (d) read with section 56 of the Banking Regulation Act, 1949.
  • The bank was also not in compliance with section 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.
  • Therefore, RBI has prohibited the United Co-operative Bank Ltd from conducting any banking business.
  • The Registrar of Cooperative Societies, West Bengal has also been requested to issue an order for winding up the bank and appoint a liquidator for the bank.
  • However, the process of paying the depositors of the bank as per the DICGC Act, 1961 will be set in motion. Therefore, the depositors will receive the full amount of their deposits.

Question: 

Q.1 In May 2021, RBI canceled the license of which bank is located inBagnan in West Bengal?
a. Contai Cooperative Bank Ltd.
b. United Co-operative Bank Ltd
c. Dhakuria Cooperative Bank Ltd
d. Union Cooperative Bank Ltd

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