The Reserve Bank of India (RBI) has revoked the license of The Yashwant Co-operative Bank in Phaltan, Maharashtra, due to insufficient capital and earning prospects. Effective immediately, the bank is barred from engaging in banking activities. The Commissioner for Cooperation and Registrar of Cooperative Societies, Maharashtra, will oversee the bank’s winding-up process and appoint a liquidator.
Every depositor of The Yashwant Co-operative Bank is eligible to claim up to Rs 5 lakh under the deposit insurance scheme by the Deposit Insurance and Credit Guarantee Corporation (DICGC) upon the bank’s liquidation. The RBI disclosed that nearly 99.02% of depositors are set to receive their full deposit amounts.
The DICGC has already disbursed Rs 106.96 crore as of April 20. The RBI emphasized that the bank’s non-compliance with the Banking Regulation Act and its inability to meet depositor obligations necessitated the license cancellation. The RBI stated that allowing the bank to continue operations would harm depositors’ interests and public welfare.
The Yashwant Co-operative Bank is now prohibited from banking activities, including deposit acceptance and repayment. The RBI’s action follows a similar license cancellation of Sarvodaya Co-operative Bank on May 12, citing comparable financial deficiencies.
