RBI cancels license of CKP Cooperative Bank

RBI cancels license of CKP Cooperative Bank

Agency News

Mumbai, May 3 : Reserve Bank of India (RBI) has cancelled the licence of Mumbai-based CKP Co-operative Bank Ltd. It had cancelled the license with effect from the close of business on April 30, 2020.

In its order, RBI has maintained that the CKP Co-operative Bank Ltd was not in a position to pay its present and future depositors due to its financial instability. In a statement issued by RBI on Saturday said, "The CKP Co-operative Bank Ltd., Mumbai, is prohibited from conducting the business of ‘banking’ which includes acceptance of deposits and repayment of deposits." The Registrar of Co-operative Societies, Pune, Maharashtra, has also been requested to issue an order for winding up the affairs of CKP Co-operative Bank Ltd.

and appoint a liquidator for the bank. The RBI said, "The financial position of the bank is highly adverse and unsustainable. There is no concrete revival plan or proposal for merger with another bank. Credible commitment towards revival from the management is not visible." "The bank is not satisfying the requirement of minimum capital and reserves....The bank is not in a position to pay its present and future depositors, thereby not complying with Section 22(3) (a) read with Section 56 of the Act," the RBI said.

RBI further said that the CKP Co-operative Bank’s efforts for revival have been far from adequate though it was given ample time and opportunity and dispensations. With the cancellation of licence and commencement of liquidation proceedings, the process of paying the depositors of The CKP Co-operative Bank Ltd., Mumbai, as per the DICGC Act, 1961 will be set in motion. On liquidation, every depositor is entitled to repayment 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) as per usual terms and conditions. (UNI)