At a time when getting a banking license has been tough as well as expensive (Rs 300-400 crores) one of the UCBs in cooperative sector Mahamedha Urban Co-operative Bank has lost it. The Ghaziabad based UCB has been closed from 22nd August 2017 onwards.
In a press release the regulator said” Reserve Bank of India has cancelled the license of Mahamedha Urban Co-operative Bank Ltd., Ghaziabad”. RBI’s order for the closure of the urban cooperative bank is dated August 11, 2017.
“The UCB cannot carry on banking business under section 22 of the Banking Regulation Act, 1949 (As applicable to Co-operative Societies) read with Section 56 of the Banking Regulation Act, 1949 with effect from close of business on August 22, 2017”, reads a RBI press release.
The bank is precluded from transacting the business of ‘banking’ as defined in Section 5(b) of the Banking Regulation Act, 1949 (As applicable to Co-operative Societies) including acceptance/ repayment of deposits, forthwith, the release read.
The statutory inspection conducted by the Reserve Bank of India in the past revealed many irregularities and violations.