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In view of the fact that the Ichalkaranji
Jiveshwar Sahakari Bank Ltd., Ichalkaranji, Dist., Kolhapur, Maharashtra, had
ceased to be solvent, all efforts to revive it in close consultation with the
Government of Maharashtra had failed and the depositors were being inconvenienced
by continued uncertainty, the Reserve Bank of India delivered the order
cancelling its licence to the bank on May 30, 2006. The Registrar of Co-operative
Societies, Maharashtra has also been requested to issue an order for winding
up the bank and appoint a liquidator for the bank. It may be highlighted that
on liquidation every depositor is entitled to repayment of his deposits up to
a monetary ceiling of Rs. 1,00,000/- from the Deposit Insurance and Credit Guarantee
Corporation (DICGC) under usual terms and conditions.
The Reserve Bank of India decided
to cancel the licence of the Ichalkaranji Jiveshwar Sahakari Bank Ltd., Ichalkaranji,
Dist., Kolhapur, Maharashtra, as a final step after examining all the options
for revival of the bank and in order to protect the interests of the depositors.
The inspection of the bank with reference to its financial position as on March
31,, 2003 revealed that the bank's financial position was unsatisfactory. The
bank was, therefore, issued directions under Section 35A of the Banking Regulation
Act, 1949 (As applicable to Co-operative Societies) with effect from the close
of business of May 14, 2003 including a cap of Rs 1000/- on withdrawal of deposits
by an individual depositor. On the basis of the RBI's requisition dated September
20, 2003 the Board of Directors of the bank was superseded on September 26,
2003 for mismanagement of the bank's affairs. The subsequent inspection of the
bank conducted with reference to its position as on March 31, 2005 revealed
further deterioration in its financial condition. Its deposits were getting
eroded as realizable value of paid-up capital and reserves was in the negative.
The Reserve Bank had issued a notice to the bank on September 02, 2005 asking
it to show cause as to why the licence granted to it to conduct banking business
should not be cancelled. As the bank did not have a viable plan of action for
its revival and the chances of its revival were remote, the Reserve Bank of
India took the extreme measure of cancelling licence of the bank in the interests
of the bank's depositors. With the cancellation of its licence and commencement
of liquidation proceedings, the process of paying the depositors of the Ichalkaranji
Jiveshwar Sahakari Bank Ltd., Ichalkarani, Dist., Kolhapur, Maharashtra, the
amount insured as per the DICGC Act, will be set in motion.
Consequent to the cancellation
of its licence, the Ichalkaranji Jiveshwar Sahakari Bank Ltd., Ichalkarani,
Dist., Kolhapur, Maharashtra is prohibited from carrying on ‘banking business’
as defined in Section 5(b) of the Banking Regulation Act, 1949 (AACS) including
acceptance and repayment of deposits.
For any clarifications, depositors
may approach Shri S.Sen, General Manager-in-Charge, Urban Banks Department,
Reserve Bank of India, Mumbai. His contact details are as below;
Postal Address: Urban Banks Department,
Reserve Bank of India, Mumbai Regional Office, Second Floor, Garment House,
Mumbai 400 018.
Telephone Number: (022) 2493 9930-49, Direct No. (022) 24928052
Fax Number: (022) 2493 5495.
Email address: rbiubd@giasbm01.vsnl.net.in
Alpana
Killawala
Chief General Manager
Press Release : 2005-2006/1553 |