Reserve Bank of India cancels the licence of Alwar Urban Co-operative Bank Ltd., Alwar, Rajasthan

Case Brief

The Reserve Bank of India cancelled the banking licence of Alwar Urban Co-operative Bank Ltd., Alwar, Rajasthan by order dated July 03, 2018, effective from the close of business on July 05, 2018. RBI said the bank did not have adequate capital and earning prospects, was not in a position to pay its present and future depositors in full as claims accrued, and its affairs were being conducted in a manner detrimental to depositor interests. RBI also noted that the bank’s financial position left no scope for revival and that public interest would be adversely affected if it were allowed to continue banking business. Following the cancellation, RBI requested the Registrar of Co-operative Societies, Rajasthan to issue a winding-up order and appoint a liquidator. Deposit repayment under the DICGC framework was to begin, subject to the statutory ceiling of ₹1,00,000 per depositor.