RBI cancelled the license of People’s Co-operative Bank Limited, Kanpur, UP

New Delhi: Reserve Bank of India (RBI), vide order dated March 17, 2022, has cancelled the license of People’s Co-operative Bank Limited, Kanpur, Uttar Pradesh on Monday. Consequently, the bank ceases to carry on banking business, with effect from the close of business on March 21, 2022. The Commissioner for Cooperation and Registrar of Cooperative Societies, Uttar Pradesh has also been requested to issue an order for winding up the bank and appoint a liquidator for the bank.

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. It also has failed to comply with the requirements of 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;

The continuance of the bank is prejudicial to the interests of its depositors. Currently 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.

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/- (Rupees Five Lakh only) from the Deposit Insurance and Credit Guarantee Corporation (DICGC) subject to the provisions of the 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 February 14, 2022, DICGC has sanctioned Rs 6.97 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, according to RBI press release.