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The Ankleshwar Nagarik Sahakari Bank Ltd., Ankleshwar

Co-operative bankAnkleshwar, Gujarat

The RBI action, regulatory basis, and operating impact linked to this entity.

Recorded RBI impact

License cancellation

License cancellation · Fresh imposition

S5

Published by RBI

20 Nov 2008

Case Brief

The Reserve Bank of India cancelled the banking licence of The Ankleshwar Nagarik Sahakari Bank Ltd., Ankleshwar with effect from the close of business on November 18, 2008. RBI said the bank had ceased to be solvent, earlier revival efforts in consultation with the Government of Gujarat had failed, and the bank did not have a viable turnaround plan. The release also notes that the bank had previously been placed under Section 35A directions restricting its activities, and that its financial position had deteriorated from impaired to precarious on inspection. RBI requested the Registrar of Co-operative Societies, Gujarat to issue winding-up orders and appoint a liquidator. After cancellation, the bank is prohibited from carrying on banking business, including acceptance and repayment of deposits, and depositor repayment will proceed subject to deposit insurance terms and conditions.

Why RBI Acted

Capital & exposure normsGovernance oversightOther

RBI cancelled the licence of The Ankleshwar Nagarik Sahakari Bank Ltd., Ankleshwar after concluding that the bank had ceased to be solvent, its financial position had deteriorated from impaired to precarious, and all efforts to revive it in close consultation with the Government of Gujarat had failed. The bank did not have a viable plan of action for revival, the possibility of turnaround was considered remote, and the cancellation was taken in the interest of depositors. RBI also noted that the bank had earlier been placed under Section 35A directions restricting its activities.

Operating Impact

The bank can no longer conduct banking business, accept deposits, or repay deposits as an operating bank. Liquidation proceedings are to begin, and depositors may recover insured amounts up to the applicable DICGC ceiling subject to the scheme's terms. RBI also provided a contact point for depositor clarifications.

Regulatory Basis

  • Section 35 A of the Banking Regulation Act, 1949 (As applicable to Co-operative Societies)
  • Section 5(b) of the Banking Regulation Act, 1949 (AACS)

Action Facts

Primary Impact
License cancellation
Order Date
18 Nov 2008
Effective From
18 Nov 2008
Entities Affected
1
Entity Role
Primary
Entity Type
Co-operative bank