Latest News | RBI Cancels Licence of Lucknow Urban Co-operative Bank

Mumbai, Sep 29 (PTI) The Reserve Bank of India on Friday said it has cancelled the banking licence of Lucknow Urban Co-operative Bank, as the lender does not have adequate capital and earning prospects.

The Commissioner and Registrar of Cooperative, Uttar Pradesh, has also been requested to issue an order for winding up the bank and appoint a liquidator for the cooperative bank, the Reserve Bank said.

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On liquidation, every depositor would be entitled to receive a deposit insurance claim amount of his/her deposits up to a monetary ceiling of Rs 5 lakh from Deposit Insurance and Credit Guarantee Corporation (DICGC).

As per the data submitted by the bank, 99.53 per cent of the depositors are entitled to receive the full amount of their deposits from DICGC, the RBI said.

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Giving reasons behind the cancellation of the licence, the central bank said Lucknow Urban Co-operative Bank does not have adequate capital and earning prospects.

"The bank with its present financial position would be unable to pay its present depositors in full," it said, adding public interest would be adversely affected if the bank is allowed to carry on its banking business any further.

Consequent to the cancellation of its licence, the bank has been prohibited from conducting the business of ‘banking', which includes, among other things, acceptance of deposits and repayment of deposits with immediate effect.

(The above story is verified and authored by Press Trust of India (PTI) staff. PTI, India’s premier news agency, employs more than 400 journalists and 500 stringers to cover almost every district and small town in India.. The views appearing in the above post do not reflect the opinions of LatestLY)