Recorded RBI impact
License cancellation
License cancellation · Fresh imposition
Published by RBI
9 Dec 2004
Case Brief
The Reserve Bank of India cancelled the licence of The Prudential Cooperative Bank Ltd., Secunderabad, under Section 22 of the Banking Regulation Act, 1949 (as applicable to Co-operative Societies). The order bars the bank from transacting banking business and specifically prohibits it from accepting deposits from the public or permitting withdrawals by cheque, draft, order or otherwise.
Why RBI Acted
The Reserve Bank of India cancelled the licence of The Prudential Cooperative Bank Ltd., Secunderabad, under Section 22 of the Banking Regulation Act, 1949 (as applicable to Co-operative Societies). As a result, the bank is precluded from transacting the business of banking and cannot accept deposits from the public or allow withdrawals by cheque, draft, order or otherwise.
Operating Impact
The bank must stop carrying on banking business and cannot take public deposits or process withdrawal instructions. Depositors and counterparties are affected because the institution is no longer authorised to operate as a bank.
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