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Rbi Bank License Canceled:The Reserve Bank of India (RBI) canceled the banking license of Ajanta Urban Co-operative Bank Limited located at Aurangabad, Maharashtra effective from April 22. This is the third bank whose license has been revoked by RBI in the month of April. The central bank made this decision public on Tuesday and has now directed the Registrar of Cooperative Societies, Maharashtra, to take steps towards closing the bank and appointing a liquidator.
Reasons Behind RBI's Decision
Ajanta Urban Co-operative Bank lost its banking license as per the RBI’s decision which has cited flagging violation of the banking law such regulation act of 1949 as primary reasons. Just about every quarter Ajanta Urban Co-operative Bank has negative capital and non-viable earning prospects.The bank has persistently underreported capital, amid recalcitrance contravening several vital sections and parts of 56, 22(3)b, 22(3)d, 22(3)e of the Act. It was closing is very detrimental to public interest and safety deposit as claimed could not repay the depositors.
Effect on Clients
The Bank post-revocation of its license is unable to accept new deposits or repay existing ones. Further shift of loan transactions or any banking activities also become impossible. Even so the bank will remain to be covered under the Deposit Insurance and Credit Guarantee Corporation Act (DICGC), 1961. For depositors, funds will be protected and ensure amounts payable to them will not exceed Rs 5 lakh.
Depositor Reimbursement
From bank balnce Rs 275.22 crore is available as unclaimed insured deposit out of total available insured amounts. As on date 3rd April 2025, with 91.55% of depositors under DICGC coverage, they are able to draw entire balance funded by the scheme.
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