The Reserve Bank of India (RBI) has, vide order dated 28 January 2021 cancelled the licence of Shivam Sahakari Bank Ltd., Ichalkaranji, Kolhapur, Maharashtra. Consequently, the bank ceases to carry on banking business, with effect from the close of business on 29 January 2021.
The Reserve Bank cancelled the licence of the bank as the bank does not have adequate capital and earning prospects. 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 section 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 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 licence, Shivam Sahakari Bank Ltd., Ichalkaranji, Kolhapur, 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.