The Reserve Bank of India (RBI) has, today, vide order dated 12 July 2021, cancelled the license of Dr. Shivajirao Patil Nilangekar Urban Co-operative Bank Limited, Nilanga, Dist. Latur, Maharashtra. Consequently, the bank ceases to carry on banking business, with effect from the close of business on July 14, 2021. The Commissioner for Cooperation and Registrar of Cooperative Societies, Maharashtra has also been requested to issue an order for winding up the bank and appoint a liquidator for the bank.
The Reserve Bank cancelled the license of the bank as:
The bank does not have adequate capital and earning prospects. As such, it does not comply with the provisions of section 11(1) and section 22(3)(d) read with section 56 of the Banking Regulation Act, 1949.
The bank has failed to comply with the requirements of sections 22(3)(a), 22(3)(b), 22(3)(c), 22(3)(d) and 22(3)(e) read with section 56 of the Banking Regulation Act, 1949;
The continuance of the bank is prejudicial to the interests of its depositors;
The bank with its present financial position would be unable to pay its present depositors in full; and
The public interest would be adversely affected if the bank is allowed to carry on its banking business any further.
Consequent to the cancellation of its license, Dr. Shivajirao Patil Nilangekar Urban Co-operative Bank Limited, Nilanga, Dist. Latur, Maharashtra is prohibited from conducting the business of ‘banking’ which includes acceptance of deposits and repayment of deposits as defined in Section 5(b) read with Section 56 of the Banking Regulation Act, 1949 with immediate effect.