Reserve Bank of India (RBI) has canceled the license of Karnataka-based Shimsha Sahakara Bank Niyamitha, Maddur due to its deteriorating financial condition.
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Bank license Canceled: Reserve Bank of India (RBI) has canceled the license of Karnataka-based Shimsha Sahakara Bank Niyamitha, Maddur due to its deteriorating financial condition. RBI said in a statement on Friday that the bank will stop banking operations after the end of working hours on July 5, 2024. The Registrar of Cooperative Societies of Karnataka has also been requested to issue an order to close this cooperative bank and appoint a liquidator for the bank.
Every depositor of this bank will be entitled to get a claim amount of up to Rs 5 lakh on his deposit from the Deposit Insurance and Credit Guarantee Corporation (DICGC). RBI said that about 99.96 percent of the depositors of this cooperative bank are entitled to get the full amount of their deposits from DICGC.
RBI said that the bank does not have sufficient capital and earning prospects and its continuation of operations is harmful to the interests of its depositors. According to the statement, “Due to its current financial position, the bank will be unable to make full payment to its depositors.”
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