RBI revokes license of Nagar Urban Co-operative Bank in Ahmednagar

By: Pune Pulse

October 5, 2023

Pune: The Reserve Bank of India (RBI) has revoked the license of the Nagar Urban Co-operative Bank in the Ahmednagar district. Furthermore, the RBI has notified that it will take further action against the bank by appointing an administrator. The RBI gave this information via email at 5 p.m. on October 4, 2023. The RBI has stated that the bank possesses insufficient capital and has minimal potential for earnings. In its order, the RBI has asserted that urban cooperative banks lack the necessary capital and earning capacity. Consequently, they are not adhering to the provisions outlined in Section 11(1) and Section 22(3)(d) of the Banking Regulation Act, 1949, as well as Section 56. The bank’s financial condition is dire, as it is unable to fully reimburse depositors.

The continuation of the bank would have a detrimental impact on public interest. Therefore, the decision has been made to revoke the bank’s license, rendering it incapable of accepting or repaying deposits.Each depositor will be entitled to receive the amount of their deposit insurance claim from the Deposit Insurance and Credit Guarantee Corporation (DICGC), up to a financial limit of Rs 5 lakh. Yogesh Dayal, Chief General Manager of the RBI, has stated that 95.15% of depositors have the right to receive the entirety of their deposits from the DICGC, based on the data submitted by the bank in accordance with the provisions of the Act, 1961.