Recorded RBI impact
License cancellation
License cancellation · Fresh imposition
Published by RBI
20 Jan 2004
Case Brief
The Reserve Bank of India has cancelled the licence of The Mahalaxmi Cooperative Urban Bank Ltd., Hyderabad, Andhra Pradesh, under Section 22 of the Banking Regulation Act, 1949 (as applicable to co-operative societies). As a result, the bank is precluded from transacting banking business and cannot accept deposits from the public or allow withdrawals by cheque, draft, order or otherwise.
Why RBI Acted
The Reserve Bank of India cancelled the licence of The Mahalaxmi Cooperative Urban Bank Ltd., Hyderabad, to carry on banking business. The order states that the bank is precluded from transacting the business of banking as defined in the Banking Regulation Act, 1949 (as applicable to co-operative societies), including accepting deposits from the public and allowing withdrawals by cheque, draft, order or otherwise. The cancellation was made under Section 22 of the Act.
Operating Impact
The bank must stop carrying on banking business immediately. Depositors and other customers will not be able to place new deposits or withdraw funds through normal banking instruments as described in the release.
Regulatory Basis
- Section 22 of the Banking Regulation Act, 1949 (as applicable to Co-operative Societies)
Action Facts
- Primary Impact
- License cancellation
- Entities Affected
- 1
- Entity Role
- Primary
- Entity Type
- Co-operative bank