the goan I network
MAPUSA
Apart from cancelling the licence of The Mapusa Urban Cooperative Bank, the Reserve Bank of India has also set in motion the liquidation proceedings of the bank.
The apex bank has requested the Central Registrar of Co-operative Societies to issue an order for winding up the bank and to appoint a liquidator.
With the cancellation of licence and commencement of liquidation proceedings, the process of paying the depositors of MUCB will be set in motion, the RBI order said.
“On liquidation, every depositor is entitled to repayment of his/her deposits up to a monetary ceiling of Rs 5 lakh from the Deposit Insurance and Credit Guarantee Corporation (DICGC),” the apex bank said.
The RBI said it has cancelled the licence of the MUCB with effect from the close of business on April 16, 2020.
The Reserve bank cancelled the licence of the bank, as MUCB does not have adequate capital and earning prospects.
“The continuance of the bank is prejudicial to the interests of its depositors and with its present financial position the bank would be unable to pay its present depositors in full,” the RBI release said.
It further said that public interest would be adversely affected if the bank was allowed to carry on its banking business any further.
Consequent to the cancellation of its licence, MUCB is prohibited from conducting the business of ‘banking’, which includes acceptance of deposits and repayment of deposits, with immediate effect, the RBI release concluded.
The cancellation of the banking licence brought to an
end a turbulent period in the history of MUCB after RBI imposed restrictions on the bank virtually crippling its functioning.
The apex bank had first imposed certain curbs on the financial transactions of the bank on July 24, 2015, which was later reviewed time to time after a period of every six months and later every three months.
Several attempts of the management to merge the bank with some robust outstation banks and salvage the prospects of the bank also failed to take off.
"The first priority is to clear the money of all the depositors. We still feel the State government can play constructive role in salvaging the institution," said Ramakant Khalap, former chairman and one of the directors of the bank.
MUCB has 24 branches in the State besides the head office in Mapusa and 193 staff members in all. The bank has 1.19 lakh shareholders and 2.48 lakh depositors.
The Mapusa Urban Cooperative Bank was established on December 9, 1965 and was the first urban coop bank in North Goa.
The RBI has granted MUCB the scheduled bank status in 1998 and a deemed multi-state cooperative bank in the same year.
