Case Brief
The Reserve Bank of India cancelled the licence of The Ravi Co-operative Bank Ltd., Kolhapur, Maharashtra after finding that the bank had ceased to be solvent and that efforts to revive it had failed. RBI noted that the bank’s financial position had first been impaired and later become precarious, that no viable plan existed to make net worth positive or satisfy regulatory prescriptions, and that continued uncertainty was inconveniencing depositors. The bank had earlier been placed under Section 35A directions restricting its operations, including a cap of Rs. 1,000 on deposit withdrawals. Following the cancellation, RBI requested the Registrar of Co-operative Societies, Maharashtra to initiate winding up and appoint a liquidator. The bank is prohibited from carrying on banking business, including acceptance and repayment of deposits, and deposit repayment will proceed through liquidation subject to the Deposit Insurance Scheme.
Action Snapshot
- Primary Impact
- License cancellation
- Entity Type
- Co-operative bank
- Location