RBI cancels license of Shri Anand Co-operative Bank Ltd., Chinchwad, Pune

The Reserve Bank of India (RBI) has cancelled the license of "Shri Anand Co-operative Bank Ltd., Chinchwad, Pune". Consequently, the bank ceases to carry on banking business, with effect from the close of business on July 7, 2022.

RBI in its release on Thursday said, "Today, the Reserve Bank of India (RBI), vide order dated July 1, 2022, has cancelled the license of "Shri Anand Co-operative Bank Ltd., Chinchwad, Pune."

The Commissioner for Cooperation and Registrar of Cooperative Societies, Maharashtra has also been requested to issue an order for winding up the bank and appoint a liquidator for the bank.

The Reserve Bank cancelled the license of the bank because:

• The bank does not have adequate capital and earning prospects. As such, it does not 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 has failed to comply with the requirements of Sections 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.
• The continuance of the bank is prejudicial to the interests of its depositors.
• The bank with its present financial position would be unable to pay its present depositors in full.
• Public interest would be adversely affected if the bank is allowed to carry on its banking business any further.

After the cancellation of the license, Shri Anand Co-operative Bank Ltd., has been prohibited from conducting the business of 'banking' which includes, among other things, acceptance of deposits and repayment of deposits with immediate effect.

RBI has said that on liquidation, every depositor would be entitled to receive deposit insurance claim amount of his/her deposits up to a monetary ceiling of Rs 5,00,000 only from Deposit Insurance and Credit Guarantee Corporation (DICGC) subject to the provisions of DICGC Act, 1961.

As per the data submitted by the bank, more than 99% of the depositors are entitled to receive full amount of their deposits from DICGC. As on May 18, 2022, DICGC has already paid Rs 9.42 crore of the total insured deposits under the provisions of Section 18A of the DICGC Act, 1961 based on the willingness received from the concerned depositors of the bank.