RBI cancels licence of Nutan Sahakari bank, Vadodara

Subscribe to Oneindia News

Mumbai, Nov 7 (UNI) The Reserve Bank of India has cancelled the licence of Nutan Sahakari Bank, Vadodara, from November five as the bank ceased to be solvent and all efforts to revive it had failed.

RBI, in a release here, said the The Registrar of Co-operative Societies, Gujarat, has been requested to issue an order for winding up the bank and appoint a liquidator.

On liquidation, every depositor is entitled to repayment of his/her deposits up to a monetary ceiling of Rs. 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 on December 16, 1986 to commence banking business. The statutory inspection of the bank with respect to its position as on December 31, 2002 had indicated that its financial position was impaired. Based on the findings of the inspection as on March 31, 2005, it was prohibited from acceptance of fresh deposits, allowing premature withdrawals and granting fresh advances vide letter dated August 18, 2005. Subsequently, as the bank's financial position deteriorated further, it was issued directions under Section 35 A of the Banking Regulation Act, 1949 (As applicable to Co-operative Societies) vide Directive dated August 08, 2007 restricting its operations, including placing a ceiling on withdrawal of deposits at Rs 1000.

Consequent to the cancellation of its licence, Nutan Sahakari Bank Ltd. is prohibited from carrying on 'banking business' as defined in Section 5(b) of the Banking Regulation Act, 1949 (AACS) including acceptance and repayment of deposits.

UNI VK OBB AG1726

Please Wait while comments are loading...