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RBI cancels the licence of Rupee Co-operative bank

Published on August 11, 2022
Current Context: Reserve Bank of India (RBI) cancels the banking licence of Rupee Co-operative bank in Pune.
RBI cancels the licence of Rupee Co-operative bank
  • The commissioner for cooperation and registrar of co-operative societies of Maharashtra has requested to issue an order for winding up the bank and to appoint a liquidator for the bank.
  • The bank is barred from conducting the business of banking which includes acceptance of deposits and repayment of deposits as defined in Section 5(b) read with Section 56 of the Banking Regulation Act 1949 with effect from September 22, 2022.
  • RBI mentioned the following reasons for the cancellation of the licence: The bank doesn't have adequate capital and earning prospects. It didn't comply with the provisions of Section 11(1) and Section 22 (3) (d) read with Section 56 of the Banking Regulation act 1949. The bank failed to comply with provisions of Section 22 (3) (a), 22 (3) (b), 22 (3) (c), 22 (3) (d) and 22 (3) (e) read with Section 56 of Banking Regulation Act 1949.
  • With the bank's current financial position it will not be able to pay its present depositors in full.
  • RBI has directed banks to provide every depositor a full amount of their deposit from Deposit Insurance and Credit Guarantee Cooperation (DICGC). Every depositor will receive a deposit insurance claim amount of their deposit up to Rs 5 lakh from DICGC.
  • Static Knowledge:
    • RBI governor - Shaktikanta Das
    • RBI headquarters - Mumbai
    • RBI was formed - on 1 April 1935

Question: 

Q.1 RBI canceled the banking licence of which co-operative bank?
a. Rupee Co-operative bank
b. Janalaxmi Co-operative bank Ltd
c. Saraswat Co-operative Bank Ltd
d. Kapol Co-operative Bank Ltd
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