Madgaum Urban Co-op Bank licence cancelled; liquidator to be named: RBI

The Reserve Bank of India on Thursday cancelled the licence of Madgaum Urban Co-operative Bank Limited, Margao, Goa, because the financial institution with its present monetary place can be unable to pay its current depositors in full.
According to the RBI, as per the information submitted by the financial institution, about 99 per cent of the depositors will obtain full quantities of their deposits from the Deposit Insurance and Credit Guarantee Corporation (DICGC). The financial institution ceases to hold on banking enterprise with impact from the shut of enterprise on July 29, 2021, the RBI stated.
The Registrar of Cooperative Societies, Goa, has additionally been requested to situation an order for winding up the financial institution and appoint a liquidator for the financial institution, the RBI stated. On liquidation, each depositor can be entitled to obtain deposit insurance coverage declare quantity of his/her deposits as much as a financial ceiling of Rs 5 lakh from the DICGC topic to the provisions of the DICGC Act, 1961.
“The bank does not have adequate capital and earning prospects. 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,” the RBI stated.
Public curiosity can be adversely affected if the financial institution is allowed to hold on its banking enterprise any additional, it stated.With the cancellation of licence and graduation of liquidation proceedings, the method of paying the depositors of the financial institution as per the DICGC Act, 1961 will likely be set in movement.
Madgaum Urban Co-operative Bank was positioned below RBI instructions vide RBI directive dated April 26, 2019 from the shut of enterprise on May 2, 2019 for a interval of six months.