Case Brief
The Reserve Bank of India cancelled the licence of The Samata Sahakari Bank Ltd., Nagpur, Maharashtra after finding that the bank had ceased to be solvent and that efforts to revive it had failed. RBI said the bank’s realizable paid-up capital and reserves were negative, revival prospects were remote, and the bank’s reply to the show-cause notice was unacceptable. The release also records that the bank had previously been placed under Section 35A directions restricting its activities. Following cancellation, the Registrar of Co-operative Societies, Maharashtra was requested to initiate winding-up and appoint a liquidator. The bank is prohibited from carrying on banking business, including acceptance and repayment of deposits, and depositors may receive insurance coverage up to the statutory DICGC limit.
Action Snapshot
- Primary Impact
- License cancellation
- Entity Type
- Co-operative bank
- Location