Reserve Bank of India cancels the license of “The Mudhol Co-operative Bank Limited, Dist.- Bagalkot, Karnataka”

Case Brief

The Reserve Bank of India cancelled the licence of The Mudhol Co-operative Bank Limited, Dist.- Bagalkot, Karnataka, by order dated June 03, 2022. RBI said the bank did not have adequate capital and earning prospects and had failed to comply with licensing requirements under Sections 11(1) and 22(3)(a) to (e) read with Section 56 of the Banking Regulation Act, 1949. RBI further said the bank’s continuance was prejudicial to depositors, that it would be unable to pay present depositors in full, and that public interest would be adversely affected if it was allowed to continue operating. As a consequence, the bank was prohibited from conducting the business of banking, including acceptance and repayment of deposits, with immediate effect. RBI also requested the Commissioner for Cooperation and Registrar of Cooperative Societies, Karnataka, to issue winding-up orders and appoint a liquidator.