Case Brief
The Reserve Bank of India cancelled the licence of Chatrapur Co-operative Bank Ltd., Chatrapur, Odisha, after concluding that the bank had ceased to be solvent, revival attempts had failed, and allowing it to continue banking would harm depositors. The release details a long history of weak financials, including negative net worth, erosion of deposits, high losses, very high NPAs, and repeated statutory non-compliance. It also notes violations of RBI directions under Section 35A, such as accepting fresh deposits despite restrictions, setting off loan amounts against fixed deposits, and refunding share capital in cash. The cancellation of the licence takes immediate effect, the bank must stop conducting banking business, and winding-up/liquidation proceedings are to be initiated.
Action Snapshot
- Primary Impact
- License cancellation
- Entity Type
- Co-operative bank
- Location