The Reserve Bank of India (RBI) has canceled the license of Osmanabad, Maharashtra based Vasantdada Nagari Sahakari Bank Limited.
Reserve Bank in its statement said, “The bank has failed to comply with the requirements and continuance of bank is prejudicial to the interest of its depositors.”
“The bank, with its present financial position, would be unable to pay its present depositors in full and it is necessary for public interest and for preventing the affairs of the bank being conducted in a manner detrimental to the interests of its depositors to wind up the affairs of the bank,” RBI said.
“Consequent to the cancellation of its license, Vasantdada Nagari Sahakari Bank Ltd., Osmanabad, 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. With the cancellation of license and commencement of liquidation proceedings, the process of paying the depositors of Vasantdada Nagari Sahakari Bank Ltd., Osmanabad, Maharashtra as per the DICGC Act, 1961 will be set in motion,” the RBI said.
“More than 99% of depositors of the bank will get a full deposit from DICGC,” it added.
The Commissioner for Cooperation and Registrar of Cooperative Societies (RCS), Maharashtra has also directed to issue an order for winding up the bank and appoint a liquidator for the bank.
