look news india
Cancellation of bank licence: The Reserve Bank of India (RBI) has cancelled the licence of Karnataka-based Shimsha Sahakari Bank Niyamitha, Maddur due to its deteriorating financial position. RBI said in a statement on Friday that the bank will cease banking operations after the close of working hours on July 5, 2024. The Registrar of Cooperative Societies, Karnataka has also been requested to issue an order to close this cooperative bank and appoint a liquidator for the bank.
Every depositor of this bank will be entitled to get a claim amount of up to Rs 5 lakh on his deposits from the Deposit Insurance and Credit Guarantee Corporation (DICGC). RBI said that about 99.96 percent of the depositors of this cooperative bank are entitled to get the full amount of their deposits from DICGC.
The RBI said the bank does not have adequate capital and earning prospects and its continued operations are detrimental to the interests of its depositors. According to the statement, “Due to its current financial position the bank will be unable to make full payment to its depositors.”