The Reserve Bank of India (RBI) cancelled the license of Madgaum Urban Co-operative Bank Limited, Margao, Goa due to its inadequate capital and earning prospects to pay its present depositors in full.
i.The bank is also prohibited from conducting the ‘banking’ business (including acceptance of deposits and repayment of deposits) as defined in Section 56 of the Banking Regulation (BR) Act, 1949.
ii.The bank did not comply with the provisions of section 11(1) and section 22 (3) (d) read with section 56 of the BR Act, 1949 and with the requirements of section 22 (3) (a), 22 (3) (b), 22 (3) (c), 22 (3) (d) and 22 (3) (e) read with section 56 of the BR Act, 1949.
iii.Paying back the depositors (Under DICGC Act, 1961): After Liquidation, every depositor would receive a deposit insurance claim amount of his/her deposits in the bank up to a monetary ceiling of Rs 5 lakh from the Deposit Insurance and Credit Guarantee Corporation (DICGC) (as per the provisions of the DICGC Act, 1961).
-RBI Imposed Rs 5 crore Penalty on Axis Bank:
i.RBI imposed a monetary penalty of Rs 5 crore on Axis Bank for non-compliance with various regulatory provisions of directions issued by the RBI on Cyber Security Framework in Banks, Financial Inclusion- Access to Banking Services – Basic Savings Bank Deposit Account, Frauds – Classification and Reporting, etc.
ii.RBI also imposed a monetary penalty of Rs 1 lakh on the Balasore Cooperative Urban Bank Limited, Balasore, Odisha for contravention of the direction issued by RBI on Exposure Norms and Statutory/Other Restrictions- Urban Cooperative Banks (UCBs).
Note – RBI imposed the penalty in the exercise of power under Section 47 A (1) (c) read with section 46 (4) (i) of the BR Act, 1949.
Recent Related News:
RBI has cancelled the license of United Co-operative Bank Ltd., Bagnan, West Bengal in May 2021, as the bank does not have adequate capital and earning prospects to pay its present depositors in full.
About Axis Bank:
Establishment –1993 (Commenced operation –1994)
Headquarters – Mumbai, Maharashtra
MD & CEO – Amitabh Chaudhry
Tagline – Badhtika Naam Zindagi
About Reserve Bank of India(RBI):
i.RBI was established in 1935 on the recommendation of the Hilton Young Commission
ii.It was nationalised in 1949
iii.The 1st headquarters of RBI was located in Kolkata