DEPOSITORS INSURANCE
RBI cancels licence of Varanasi-based Banaras Merchantile Co-op Bank
RBI cancels Banaras Merchantile Co-operative Bank's license citing financial instability. Depositors to receive up to Rs 5 lakh from DICGC. Bank lacks capital and earning prospects, leading to liquidation.
DICGC needs more resources
The Deposit Insurance and Credit Guarantee Corporation (DICGC) needs to increase its reserve ratio, manage treasury proactively, and upgrade its digital infrastructure to meet future payment obligations, as per a research paper in the RBI bulletin.
Indian deposit insurer way behind global peers in processing reimbursements: RBI Deputy Governor
RBI deputy governor Michael Patra highlighted that India's deposit insurer DICGC lagged behind international counterparts in processing reimbursements, taking over a month compared to IADI's target of seven days. Challenges such as data quality, identification issues, and lack of alternative bank accounts hinder quick payouts. India mandates deposit insurance for all banks, covering 1,997 institutions, with a coverage limit of Rs 5 lakh per depositor. Patra emphasised the need for improved risk management and crisis frameworks in light of evolving challenges, such as climate change impacting financial systems.
DICGC lags global peers in processing claims: Michael Patra
DICGC takes about a month or more to reimburse deposits when a bank collapses, while the International Association of Deposit Insurers (IADI) is moving towards reimbursement within seven days from 14 days now, Patra said in his keynote speech at the IADI executive committee meeting in Rome.
High FD interest rates may not last long despite RBI status quo; is this the last window to book fixed deposits at higher rates?
FD Interest Rates: RBI in its MPC meeting on June 7 kept the repo rate unchanged at 6.5%. This marks the eighth consecutive MPC with status quo, benefiting fixed deposit investors with high rates. However, going forward the interest rate cycle to reverse. The potential for a rate cut later in the year is anticipated.
DICGC posts 17% growth in insurance fund
The fund is collected by premiums received from insured banks, interest income from investments, and cash recoveries from failed banks. The deposit insurance limit in India is set at ₹5 lakh per depositor per bank.
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Will this bank continue to offer 9.2% interest on fixed deposit post-merger? Know what changes for FD investors
Interest rates on small finance bank FDs had gone up and small finance banks (SFBs) were offering 9% to 9.5%. Earlier, Fincare Small Finance Bank used to offer 9.21% to senior citizens on FDs maturing in 750 days. Now Fincare SFB merged with AU Small Finance Bank, effective from April 1. Now, customers should be aware of what will happen to the FDs they had opened in Fincare SFB before the merger? Will they be eligible for the deposit insurance protection of up to Rs 5 lakh, including principal and interest? Will the IFSC codes change after the merger?
Frauds by bank employees: Take these steps to ensure branch manager or any other employee does not run away with your money
Fraud by bank employees: Many reports of bank employees defrauding customers of the bank. These are the cases where the bank and its customers both are the victims of fraud by the employee(s). In a recent judgement by the SC, it was said that banks would be held liable for criminal misconduct by its employees.
RBI imposes restrictions on Pratapgarh-based National Urban Co-op Bank
The RBI on Monday imposed several restrictions on National Urban Co-operative Bank Ltd, Pratapgarh (Uttar Pradesh), including capping withdrawal at Rs 10,000 for customers, in the wake of the lender's deteriorating financial situation. The eligible depositors will be entitled to receive a deposit insurance claim amount of his/her deposits up to Rs 5 lakh only from the Deposit Insurance and Credit Guarantee Corporation (DICGC).
Another bank in crisis: RBI stops customers from withdrawing money; what are your rights as depositors if your bank fails?
What happens to your money if a bank fails in India? The Reserve Bank of India (RBI) has imposed restrictions on Shirpur Merchants' Co-operative Bank amid its worsening financial health. The most significant restriction? A freeze on customer withdrawals. The RBI has previously imposed similar curbs on troubled lenders like PMC Bank. But what recourse do depositors have when their bank hits a rough patch? And what should customers of Shirpur Merchants' Co-operative Bank do now? ET Wealth Online answers these critical questions.
Family of deceased housewife wins Rs 6 lakh in SC; homemaking not a valid ground for low payout to accident victim
Motor Accident Death: Supreme Court Holds homemaker’s life as valuable as others and hence hikes compensation to car accident victim's family to Rs 6 lakh. The deceased who was a homemaker died when her car lost control and skid off the road and fell into a ditch in 2006. She is survived by her husband and two children who were studying at that time.
RBI cancels licence of Jai Prakash Narayan Nagari Sahakari Bank
On liquidation, every depositor would be entitled to receive a deposit insurance claim amount of his/her deposits up to a monetary ceiling of Rs 5 lakh from Deposit Insurance and Credit Guarantee Corporation (DICGC). As per the data submitted by the bank, about 99.78 per cent of the depositors are entitled to receive the full amount of their deposits from DICGC, the Reserve Bank said.
If you hold FDs in two merging banks the insurance of your deposits may halve post-merger
It is quite a big task when two banks are being merged either forcibly or voluntarily. There has been few cases of bank mergers in India and some of them were due to Reserve Bank of India's direction and some were due to business needs. Regardless of the reason of merger, the deposit insurance amount would get impacted once the merger between two or more banks happen.
National Cooperative Bank comes under RBI action, scores of depositors rush to withdraw money
The RBI put out a statement in the morning limiting the bank's powers after it found the bank's finances to be weak to carry out normal business transactions. There were long queues of customers wanting to withdraw whatever they could, but crowds had only swollen by the evening. Many customers had brought their fixed deposit bonds to encash, but were in vain.
How to claim unclaimed money from bank savings accounts, FDs
The Reserve Bank of India has asked banks to identify accounts that have not had any customer-initiated transactions in over ten years. As per the regulation banks are required to transfer credit balances in such accounts to the Depositors Education and Awareness Fund (DEAF).
Warren Buffett lessons for SVB, Signature bankers and wealthy depositors
If all deposits were insured, no one would fear losing their cash and perhaps there would never be bank runs. Certainly, the FDIC wouldn’t now be sending America’s banks a $15.8 billion bill to cover its costs from rescuing uninsured depositors at the two lenders. There likely would have been no systemic spillover threat to the economy forcing the FDIC to act.
HDFC-HDFC Bank merger: Interest, depositors’ insurance, withdrawal rules; what changes for HDFC FD customers
HDFC is all set to merge with HDFC Bank by June 2023. The merged entity will be known as HDFC Bank. Customers of HDFC, whether borrowers or depositors, will witness certain changes after the merger. From the interest rate of fixed deposits to premature withdrawal rules, here's a list of things that will change for HDFC customers post-merger.
US govt ready, Janet Yellen gives big assurance to bank depositors
The federal government “is resolutely committed” to mitigating financial-stability risks where necessary, Yellen said in a question-and-answer session. “The public should have confidence in our banking system.”
Bring back your money, new Silicon Valley Bank CEO urges depositors
In a Zoom meeting with select investors and limited partners (LPs), he also asked for new deposits, saying that both existing and new deposits will be protected by the Federal Deposit Insurance Corporation (FDIC).
Silicon Valley Bank depositors will have access to their money starting Monday: Treasury Secretary
"The depositors will have access to all their money starting Monday, that is, March 13. No losses associated with the resolution of the Silicon Valley Bank (SVB) will be borne by the taxpayer," said a joint statement issued by the Department of the Treasury, Federal Reserve, and FDIC.
SVB crisis puts more than one lakh jobs in red: Y Combinator petitions US Treasury
The petition, written by Y Combinator president Garry Tan, has been signed by over 3,500 CEOs and founders. The signatories also include almost two dozen startups with a base in India.
Regulators to dispose of SVB's assets to protect depositors
The main office and all branches of Silicon Valley Bank will reopen on March 13 and all insured depositors will have full access to their insured deposits no later than Monday morning.
SVB depositors, investors tried to pull $42 billion Thursday
The bank had a negative cash balance of $958 million at the close of business on March 9
Silicon Valley Bank shut down by regulator as depositors pull cash
Silicon Valley Bank had about $209 billion in total assets and about $175.4 billion in total deposits, as of Dec. 31, 2022.
RBI cancels Seva Vikas Co-operative Bank’s licence: What depositors should know
The Reserve Bank of India (RBI) has revoked the licence of Pune-based Seva Vikas Co-operative Bank because the lender lacks appropriate capital and earning potential.
99% of Laxmi Co-op Bank depositors to get full deposit claim on liquidation: RBI
The bank will cease to carry on banking business from the close of business on September 22, 2022. The bank will also be wound up and a liquidator will be appointed for the bank. Upon liquidation depositors would receive an insurance claim of upto Rs 5 lakh. The data submitted by the bank indicates that upto 99 percent of the depositors will receive the full amount .
DICGC to make payments in October to depositors of 17 co-op banks facing RBI restrictions
The Reserve Bank of India (RBI) had imposed several restrictions, including on withdrawals, by depositors of 17 cooperative banks in July in view of their deteriorating financial positions. Of the 17 cooperative banks, eight are in Maharashtra, four in Uttar Pradesh, two in Karnataka, and one each in New Delhi, Andhra Pradesh and West Bengal.
RBI's deposit insurance arm to pay depositors of two co-operative banks in August
Eligible depositors of Shankarrao Pujari Nutan Sahakari Bank will get the payment on August 10, and those of Harihareshwar Sahakari Bank on August 28, according to a DICGC circular.The Reserve Bank of India (RBI) had imposed several restrictions, including on withdrawals by depositors, on these two banks in May in the wake of their deteriorating financial positions.
Depositors of Lucknow cooperative bank to get money from DICGC on April 27
Depositors of Beed-based Dwarakadas Mantri Nagari Sahakari Bank will get payments on June 6. DICGC, a wholly-owned subsidiary of the RBI, provides an insurance cover of up to Rs 5 lakh on bank deposits. As per the corporation, the amount of assessable deposits stood at Rs 1,49,67,770 crore at end-March 2022.
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