RBI canceled licence of Maharashtra-based Laxmi Cooperative Bank

Reserve Bank of India has canceled the license of Solapur-based The Laxmi Co-operative Bank Limited as the lender does not have adequate capital and earning prospects. The Laxmi Co-operative Bank Limited submitted the data, which shows more than 99 percent of the depositors are entitled to receive the full amount of their deposits from Deposit Insurance and Credit Guarantee Corporation (DICGC).

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Key Points Laxmi Co-operative Bank Limited

• The DICGC has already paid Rs 193.68 crore of the total insured deposits on 13th September 2022.
• The Laxmi Co-operative Bank ceases to carry on banking business, with effect from the close of business.
• The Laxmi Co-operative Bank Limited has failed to comply with the requirements of the Banking Regulation Act 1949.
• After the cancellation of its license, Laxmi Co-operative Bank Limited is prohibited from conducting the business of banking, which includes acceptance of deposits and repayment of deposits, and others.
• The Commissioner for Corporation and Registrar of Cooperative Societies, Maharashtra has also been requested to issue an order for winding up the bank and appoint a liquidator for the bank.
• On liquidation, every depositor will be entitled to receive a deposit insurance claim amount of his/her deposits up to Rs 5 lakh from DICGC.