Case Brief
The Reserve Bank of India cancelled the licence of Shri Kalmeshwar Urban Co-operative Bank Ltd., Hole-Alur, District Gadag, Karnataka, after finding that the bank had ceased to be solvent and that its financial position was precarious. RBI said efforts to revive the bank, undertaken in consultation with the Government of Karnataka, had failed, no viable revival plan existed, and the bank did not reply to the show-cause notice issued on November 14, 2006. RBI also noted that directions under Section 35A had earlier been issued on October 6, 2006 to protect depositors. Following the cancellation, RBI requisitioned the Registrar of Co-operative Societies, Karnataka, to initiate winding up and appoint a liquidator. The bank was thereafter prohibited from carrying on banking business, including accepting and repaying deposits, subject to liquidation and deposit insurance terms.
Action Snapshot
- Primary Impact
- License cancellation
- Entity Type
- Co-operative bank
- Location