Depositors of liquidated Uttar Pradesh bank to get relief

April 12th, 2008 - 2:44 pm ICT by admin  

Lucknow, April 12 (IANS) The seven-year-old agonising wait of depositors of the liquidated City Cooperative Bank appears to be coming to an end with the official announcement that payments up to Rs.100,000 would be released to each. More than 10,000 depositors were left in the lurch when the bank suddenly closed in March 2001, following a major financial scam triggered by its promoters - Century Consultants - which swindled a whopping sum of about Rs.5 billion.

Several proposals were floated for the bank’s revival but the Reserve Bank of India (RBI) did not see any hope of making it viable.

Eventually, in October 2004, the RBI decided to appoint Uttar Pradesh registrar of cooperative societies as its official liquidator.

After a lot of running around by its depositors, the Deposit Insurance and Credit Guarantee Corporation (DICGC) Friday decided to settle their accounts.

“The payment of Rs.1 lakh (100,000) to each of the depositors is being made out of the insurance money received from DICGC. Meanwhile assets of the bank have been estimated at about Rs.24 crores (240 million),” Pradeep Shukla, registrar of cooperative societies, told IANS Saturday.

Admitting that there would be several depositors with much more than Rs.100,000 in the bank, he said: “Well, the existing rules provide insurance for deposits in cooperative banks only to the tune of Rs.1 lakh. At least this would bring some respite to small and medium depositors who had nearly given up hope of retrieving their hard earned money from the bank.”

The bank has decided to issue fresh notices to all those depositors who have not filed their claims. The payment exercise will commence within a month.

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