RBI Cancels Licence of Tezpur's Mahabhairab Cooperative Urban Bank

The Reserve Bank of India (RBI) announced the cancellation of the licence for Tezpur-based Mahabhairab Cooperative Urban Bank due to its deteriorating financial condition. The bank will cease operations effective July 24, 2024. The decision aims to protect depositors, with 99.8% eligible to receive up to Rs 5 lakh in insured deposits.

The Reserve Bank of India (RBI) has revoked the licence of Tezpur's Mahabhairab Cooperative Urban Bank due to its worsening financial health, effective from the close of business on July 24, 2024.

In response to the licence cancellation, the Registrar of Cooperative Societies in Assam has been requested to commence the winding-up process and appoint a liquidator for the bank.

According to the RBI, the cooperative bank lacks adequate capital and earning prospects and cannot fulfill its obligations to depositors. However, 99.8% of depositors are eligible to claim up to Rs 5 lakh from the Deposit Insurance and Credit Guarantee Corporation (DICGC), which has already disbursed Rs 20.03 crore as of June 13, 2024.

(With inputs from agencies.)