In view of the fact that The Rajwade Mandal People's Co-operative Bank Ltd., Dhule, District Dhule, Maharashtra had ceased to be solvent, all efforts to revive it in close consultation with the Government of Maharashtra had failed and the depositors were being inconvenienced by continued uncertainty, the Reserve Bank of India delivered the order of rejecting application for licence to the bank after the close of business on 27 January, 2010. The Registrar of Co-operative Societies, Maharashtra has also been requested to issue an order for winding up the bank and appoint a liquidator for the bank. It may be highlighted that on liquidation, every depositor is entitled to repayment of his/her deposits up to a monetary ceiling of Rs.1,00,000/- (Rupees One lakh only) from the Deposit Insurance and Credit Guarantee Corporation (DICGC) under usual terms and conditions.
The bank applied for a licence to function as a co-operative bank to Reserve Bank on May 19, 1966. The statutory inspection of the bank as on March 31, 2008 revealed that the bank's financial position had deteriorated. The subsequent statutory inspection of the bank with reference to its financial position as on March 31, 2009 revealed that the position of the bank was precarious. The Reserve Bank of India issued directions under Section 35A of the Banking Regulation Act, 1949 (As applicable to Co-operative Societies) vide Directive UBD.CO.NSB-I.No.D-54/12.22.315/2009-10 dated August 10, 2009 restricting its operations.
The Reserve Bank of India issued a notice to the bank on September 1, 2009 asking it to show cause as to why the application for licence to it to conduct banking business should not be rejected. The reply to the show cause notice was examined and it was observed that the bank did not have any viable plan of action for its revival.
In the absence of any viable proposal for turnaround to achieve the required regulatory prescriptions, the possibility of revival of the bank was remote. Therefore, the Reserve Bank of India took the extreme measure of rejecting the licence application of the bank in the interest of the bank's depositors. With the rejection of its application for licence and commencement of liquidation proceedings, the process of paying the depositors of The Rajwade Mandal Peoples' Co-operative Bank Ltd., Dhule District Dhule, Maharashtra will be set in motion subject to the terms and conditions of the Deposit Insurance Scheme.
Consequent to the rejection of its application for licence, Rajwade mandal Peoples' Co-operative Bank Ltd., Dhule, District Dhule, Maharashtra is prohibited from carrying on ‘banking business’ as defined in Section 5(b) of the Banking Regulation Act, 1949 (AACS) including acceptance and repayment of deposits.
For any clarifications, depositors may approach Shri P.K.Arora, Deputy General Manager, Urban Banks Department, Mumbai Regional Office, Reserve Bank of India, Mumbai. His contact details are as below:
Postal Address: Urban Banks Department, Mumbai Regional Office, Reserve Bank of India, Second Floor, Garment House, Mumbai 400 018. Telephone No. (022) 2493 9930-49, Direct No. (022) 2493 5348, Fax No. (022) 2493 5495, Email Ajit Prasad
Manager Press Release : 2009-2010/1110 |
