Following directive of Reserve Bank of India (RBI) the state government declared closure of the bank on September 14 and appointed liquidator. RBI had scarped the license of the co-operative bank after the local branch become bankrupt in October last year. Officials of the bank said that due to the heavy amount of pending loans, the co-operative bank became bankrupt.
Challenging the closure decision, the President of the bank management committee had filed a petition in the high court. Hearing the petition the court has put a stay on the closure of the bank till the next hearing. Notably on September 23, Jharkahnd Mukti Morcha (JMM) had called district bandh opposing the closure of the co-operative bank. Many organizations in the districts had supported the band. JMM demanded to re-open the bank and refund the money of the depositors.