RBI cancels CKP Co-operative Bank’s licence; depositors to get up to Rs 5 lakh ONLY

The Reserve Bank of India (RBI) on Saturday cancelled the license of Mumbai-based CKP Co-operative Bank. The RBI said ‘financial position of the bank is highly adverse and unsustainable’. It further added that the depositors are entitled to repayment of their deposits up to Rs 5 lakh only.

“With the cancellation of licence and commencement of liquidation proceedings, the process of paying the depositors of The CKP Co-operative Bank Ltd., Mumbai, as per the DICGC Act, 1961 will be set in motion. On liquidation, every depositor is entitled to repayment of his/her deposits up to a monetary ceiling of Rs 5,00,000 from the Deposit Insurance and Credit Guarantee Corporation (DICGC) as per term and conditions.

The central bank’s move means that the troubled co-operative bank will be prohibited from carrying out any banking business, including accepting deposits etc.

According to reports, the co-operative bank has 1.25 lakh account holders. The CKP Co-operative Bank Ltd’s net worth is stated to be Rs 230 crore.

Meanwhile, the Maharashtra unit of AAM ADMI PARTY (AAP) questioned the Centre over the action against CKP Co-operative Bank Ltd.

“In 2014 restrictions were placed on CKP Bank, just like they were placed on PMC Bank last year. Now, stealthily CKP bank has been shut, with the no mercy shown on the depositors which are largely middle class people with small savings,” the AAP Maharashtra unit said in a series of tweets. “On the other hand, a private bank like YES BANK where the scam is there for all to see got a bail out from the same government within a month simply because it has rich corporate customers,” it added.

Accordingly, on liquidation, every depositor is entitled to repayment of his/her deposits up to a monetary ceiling of Rs 5 lakh from the DICGC.

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