Laxmi Co-operative Bank Limited, located in Solapur, had its license revoked by the RBI on Thursday for violating several sections of the Banking Regulation Act 1949.
“The Reserve Bank revoked the bank’s license because it did not have sufficient capital and future income potential. Therefore, it does not comply with the rules of Articles 11(1) and 22(3) (d) read in conjunction with Section 56 of the Banking Regulation Act, 1949. According to a central bank statement, the bank “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.”
Effective the close of business on September 22, 2022, the lender will cease carrying on its banking business.
With immediate effect, “The Laxmi Co-operative Bank Limited, Solapur, Maharashtra” is prohibited from engaging in banking business, which includes but is not limited to accepting deposits and redeeming deposits as specified in section 5(b) read together with section 56 of the Banking Regulation Act 1949.
The RBI said that in the event of liquidation, depositors will receive a deposit insurance claim sum up to a maximum of Rs5 lakh.
“99% of depositors are eligible to recover the full value of their deposits from DICGC, according to data provided by the bank. had already paid Rs193.68 crore of the total deposits insured under Section 18A of the DICGC Act, 1961” He read.
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