Case Brief
RBI cancelled the licence of Bhagyodaya Friends Urban Co-operative Bank Limited, Warud, Dist. Amravati, Maharashtra by order dated April 20, 2021. The bank was found to lack adequate capital and earning prospects and to be non-compliant with multiple provisions of the Banking Regulation Act, 1949, including section 11(1) and section 22(3) read with section 56. RBI also noted that the bank’s continuance would be prejudicial to depositors, that it would be unable to pay depositors in full, and that allowing it to continue would adversely affect public interest. Following the cancellation, the bank is prohibited from conducting banking business, including accepting and repaying deposits, with effect from the close of business on April 22, 2021, and winding-up/liquidation steps were requested from the state registrar.
Action Snapshot
- Primary Impact
- License cancellation
- Entity Type
- Co-operative bank
- Location