RBI cancels CKP Co-op Bank’s licence


The Reserve Bank of India (RBI) has cancelled the licence of Mumbai-based The CKP Cooperative Bank Ltd., with effect from the close of business on April 30, 2020, as the lender’s financial position had deteriorated and it was not in a position to repay depositors.

“The Registrar of Co-operative Societies, Pune, Maharashtra, has also been requested to issue an order for winding up the affairs of The CKP Cooperative Bank Ltd., Mumbai, and appoint a liquidator for the bank,” RBI said in a late evening statement on Saturday.

The depositors of the bank will get a maximum of ₹5 lakh from the Deposit Insurance and Credit Guarantee Corporation (DICGC), as per law. The deposit insurance cover was increased to ₹5 lakh from ₹1 lakh earlier this year. The bank has a deposit base of ₹485.56 crore, as on November 2019.

“The financial position of the bank is highly adverse and unsustainable. There is no concrete revival plan or proposal for merger with another bank. Credible commitment towards revival from the management is not visible,” the RBI said, giving reasons for the decision.

The bank has negative networth of ₹239.2 crore. It has a customer base of 1,34,167 and has eight branches spread across Mumbai and Thane districts.

The banking regulator said the bank did not satisfy the requirement of minimum capital and reserves and was not in a position to pay its present and future depositors.

“The affairs of the bank were and are being conducted in a manner detrimental to public interest and interest of the depositors, and the general character of the management of the bank is prejudicial to the interest of depositors as also public interest,” RBI said.

The banking regulator observed that the bank’s efforts for revival have been ‘far from adequate’ though the bank has been given ample time and opportunity and dispensations.

“No merger proposal has been received in respect of the bank. Thus, in all likelihood, public interest would be adversely affected if the bank were allowed to carry on its business any further,” the RBI said.

You have reached your limit for free articles this month.

Register to The Hindu for free and get unlimited access for 30 days.

Subscription Benefits Include

Today’s Paper

Find mobile-friendly version of articles from the day’s newspaper in one easy-to-read list.

Unlimited Access

Enjoy reading as many articles as you wish without any limitations.

Personalised recommendations

A select list of articles that match your interests and tastes.

Faster pages

Move smoothly between articles as our pages load instantly.


A one-stop-shop for seeing the latest updates, and managing your preferences.


We brief you on the latest and most important developments, three times a day.

Not convinced? Know why you should pay for news.

*Our Digital Subscription plans do not currently include the e-paper ,crossword, iPhone, iPad mobile applications and print. Our plans enhance your reading experience.


Source link

Leave a Reply

Your email address will not be published. Required fields are marked *