Four More Urban Cooperative Banks in Odisha Face Liquidation

Even after liquidation of six urban cooperative banks in the State, four of the remaining nine banks are heading in that direction.

Published: 18th December 2015 06:48 AM  |   Last Updated: 18th December 2015 07:04 AM   |  A+A-

BHUBANESWAR:  Even after liquidation of six urban cooperative banks in the State, four of the remaining nine banks are heading in that direction.

The cooperative banks which have incurred loss in the last fiscal are Cuttack UCB (Rs5.61 crore), Rourkela UCB (Rs14.59 lakh), Berhampur UCB (Rs8.14 lakh) and Jeypore UCB (Rs33.64 lakh).

The five urban cooperative banks (UCBs), which have registered marginal profit during 2014-15 fiscal, include Utkal Cooperative Banking Society, Bhubaneswar. The cooperative bank in the City has made an operational profit of Rs1.32 crore.

Six banks which are under liquidation include Aska UCB, Bhanjanagar UCB, Dhenkanal UCB, Chatrapur UCB and Baripada UCB.

The Reserve Bank of India (RBI) had cancelled the banking licence of Urban Cooperative Bank, Bhubaneswar last year following failure on the part of the State Government to merge it with any other co-operative society.

However, the operation of RBI order for cancellation of banking licence of Baripada UCB and the process to liquidate the bank by appointing a liquidator by the Registrar of Cooperative Societies have been stayed by the Orissa High Court.

The six banks under liquidation have a deposit of Rs107.14 crore by the depositors. While depositors of Bhanjanagr and Dhenkanal UCBs have been paid up to Rs1 lakh of their deposit as per Deposit Insurance and Credit Guarantee Corporation (DICGC) Act, steps are being taken to refund similar amount to depositors of other UCBs, Cooperation Minister Damodar Rout said.

The Minister said the liquidators have been asked to take legal process to recover the loan from defaulters and after recovery, the balance amount will be refunded.

In 2007, the State Government infused an equity of Rs6 crore in Bhubaneswar UCB but the revival of the bank was not possible. While the bank owed about Rs28 crore to its depositors, it had failed to recover Rs35 crore, including Rs19 crore as principal, from loanees. The bank’s customer base was about 14,000.

The State Government had taken the initiative for a merger of the bank with Pune-based Cosmos Cooperative Bank Society. However, with huge unrecovered loan and various other bottlenecks, the merger plan fell through.

According to a report of Cooperation Department, the Parlakhemundi UCB has made a profit of Rs1.19 lakh while the Balasore UCB registered a profit of Rs15.25 lakh. Puri and Kendrapara UCBs have made a profit of Rs32.14 lakh and Rs17.70 lakh in the last fiscal respectively.

Banks which have incurred loss are Cuttack UCB (Rs5.61 cr), Rourkela UCB (Rs14.59L), Berhampur UCB (Rs8.14L) and Jeypore UCB (Rs33.64L)


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