PUNE The Reserve Bank of India (RBI), on Wednesday, cancelled the licence of Sarjeraodada Naik Shirala Sahakari Bank Ltd, Shirala, Sangli district, over lack of adequate capital and earning prospects.
The RBI in a release said the bank’s licence was cancelled as it failed to comply with various sections of the Banking Regulation Act.
The continuance of the bank is prejudicial to the interests of its depositors and with its present financial position, it would be unable to pay its present depositors in full, the release said.
“Consequent to the cancellation of its licence, Sarjeraodada Naik Shirala Sahakari Bank Ltd, Shirala, district Sangli, Maharashtra, is prohibited 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 immediate effect,” said RBI in its release.
According to RBI, the licence of the cooperative 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, and Public interest would be adversely affected if the bank is allowed to carry on its banking business any further,” stated RBI.
{{/usCountry}}“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, and Public interest would be adversely affected if the bank is allowed to carry on its banking business any further,” stated RBI.
{{/usCountry}}