RBI cancels CKP Cooperative Bank’s licence due to weak financial health

RBI

The Reserve Bank of India has cancelled the licence of The CKP Co-operative Bank Ltd., Mumbai, amid its weak financial health of the lender. With the suspension, the cooperative bank is now prohibited from acceptance and repayment of any deposits.

RBI

The RBI said that the financial position of the bank is “highly adverse” and “unsustainable”, adding there the lender has no concrete revival plan or proposal for amalgamation with another bank. The bank is not meeting the regulatory capital requirements, and is also not capable of paying its present and future depositors, the regulator further revealed.

“The affairs of the bank were and are being conducted in a manner detrimental to the public interest and interest of the depositors and that the general character of the management of the bank is prejudicial to the interest of depositors as also public interest,” RBI said in its press release.

The Registrar of Co-operative Societies, Pune (Maharashtra) has been directed by the regulator for issuing an order for winding up the affairs of the bank, and appoint a liquidator. On liquidation, every depositor is eligible to repayment of his/her deposits up to a monetary ceiling of Rs 5,00,000/- (Rupees Five lakh only) from the Deposit Insurance and Credit Guarantee Corporation (DICGC), the RBI said.

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