Banking

RBI cancels licence of Subhadra bank | Kolhapur News

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KOLHAPUR: The Reserve Bank of India (RBI) has cancelled the banking licence of Kolhapur-based Subhadra Local Area Bank Ltd for violation of the Banking Regulations Act.
However, considering the bank’s liquidity, the RBI has allowed it to return the deposits to customers.
The order to cancel the banking license was issued late on Thursday as the bank failed to maintain minimum net worth for minimum two quarters in the previous financial year.
The RBI order said that the decision to cancel the license was taken as bank’s condition for the existing and future customers was not satisfactory and many cause financial losses.
“Consequent to the cancellation of the licence, the bank is prohibited from conducting the business of ‘banking’ as defined in section 5(b) or any additional business envisaged under section 6 of the Banking Regulation Act, 1949 with immediate effect. We will make an application for winding up before the High Court,” the RBI said in a statement.
Subhadra Bank was started in Kolhapur in the year 2003 and was granted permission to open branches in Sangli, Satara and Belagavi. The bank had three branches in Kolhapur, but only one branch was operational.

Read more at timesofindia.indiatimes.com

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