Banking license of Adoor Co-operative Urban Bank cancelled: The Reserve Bank of India (RBI) has canceled the license of another bank for the allegation of negligence and protection of depositors’ money. This time RBI has canceled the banking license of Kerala based Adoor Co-operative Urban Bank. This decision of RBI will not affect the non-banking finance business of the bank.
RBI in its notification said that the cancellation of license of Adoor Co-operative Urban Bank is effective from the close of business on April 24, 2023. RBI has informed that the Adoor Co-operative Urban Bank Limited was granted a banking license on January 3, 1987 to conduct banking business in India under the Banking Regulation Act.
After the cancellation of the license, now the rules of RBI will be applicable on the money of the deposit holders of Adoor Co-operative Urban Bank. Under this, the account holders who have deposits up to Rs 5 lakh will get the entire money back. On the other hand, those who have more than Rs 5 lakh deposited in their accounts, they will get only Rs 5 lakh back.
Here deposits up to Rs 5 lakh mean the amount with interest. If someone has deposited up to Rs 4 lakh, and that amount is Rs 5 lakh with interest, then the entire amount will be returned. But if there is a deposit of Rs 5 lakh, and this amount with interest is Rs 6 lakh, then only Rs 5 lakh will be returned.
At the same time, RBI has also imposed penalty on 4 cooperative banks for violating different norms. These banks include Tamil Nadu State Apex Co-operative Bank, Bombay Mercantile Co-operative Bank, Janata Sahakari Bank and Baran Nagrik Sahakari Bank. A total penalty of Rs 44 lakh has been imposed on these banks.
