RBI Cancels Licence of HCBL Co-operative Bank, Lucknow

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The Reserve Bank of India (RBI) has cancelled the banking licence of HCBL Co-operative Bank Ltd., Lucknow with effect from the close of business on May 19, 2025. This means the bank will no longer be allowed to carry out any banking activities such as accepting or repaying deposits.
The RBI said the bank does not have enough capital or future earning potential, and it has failed to meet several key rules under the Banking Regulation Act, 1949. The RBI also stated that continuing the bank’s operations would be harmful to the interest of its depositors, as the bank is not in a position to repay them in full.
Following the cancellation, the Commissioner and Registrar of Cooperative Societies, Uttar Pradesh has been asked to begin the process of winding up the bank and appointing a liquidator.
What this means for depositors:
Once the bank is liquidated, depositors are eligible to get back up to ₹5 lakh of their deposits through the Deposit Insurance and Credit Guarantee Corporation (DICGC). According to data provided by the bank, 98.69% of depositors will get the full amount of their deposits under this insurance scheme.
As of January 31, 2025, DICGC has already paid out ₹21.24 crore to eligible depositors who had submitted their claims.
Key reasons for licence cancellation:
- The bank lacked sufficient capital and had weak earnings.
- It failed to meet key regulatory requirements under various sections of the Banking Regulation Act.
- Its continued operations were considered risky for depositors and not in the public interest.
The RBI emphasized that the bank’s financial condition made it unable to pay back its depositors, and allowing it to continue operating would have further harmed public trust and safety in the banking system.