The Reserve Bank of India imposed monetary penalties on five cooperative banks and extended the period of directions on Ramgarhia Cooperative Bank for three months till 8th April 2024 on Monday.
The banks penalized included, Navsarjan Industrial Co-operative Bank, Mehsana Jilla Panchayat Karmachari Co-operative Bank, Halol Urban Co-operative Bank, Stambhadri Co-operative Urban Bank and Subramanianagar Co-operative Urban Bank.
The Reserve Bank of India imposed a monetary penalty of Rs 7.00 lakh on Navsarjan Industrial Co-operative Bank Ltd., Ankleshwar, dist. Bharuch, Gujarat (the bank) for non-compliance with the directions issued by RBI on ‘Placement of Deposits with Other Banks by Primary (Urban) Co-operative Banks (UCBs)’, ‘Reserve Bank of India (Know Your Customer (KYC)) Directions, 2016’ and contravention of ‘Section 26A (2) read with Section 56 of the Banking Regulation Act, 1949 (BR Act)’.
A monetary penalty of Rs 3.00 lakh has been imposed on the Mehsana Jilla Panchayat Karmachari Co-operative Bank Ltd., Mehsana, Gujarat (the bank) for non-compliance with the directions issued by RBI on ‘Placement of Deposits with Other Banks by Primary (Urban) Co-operative Banks (UCBs)’ and contravention of provisions of Section 26A(2) read with Section 56 of the Banking Regulation Act, 1949 (BR Act).
Besides, a penalty of Rs 2.00 lakh has been imposed on the Halol Urban Co-operative Bank Ltd., Panchmahal, Gujarat (the bank) for non-compliance with the directions issued by RBI on ‘Loans and Advances to directors, relatives and firms/concerns in which they are Interested’ read with ‘Loans and Advances to Directors etc. – Directors as surety/guarantors – Clarification’, ‘Placement of Deposits with Other Banks by Primary (Urban) Co-operative Banks (UCBs)’ and ‘(Co-operative Banks – Interest Rate on Deposits) Directions, 2016’.
Similarly, RBI imposed a monetary penalty of Rs 50,000 on the Stambhadri Co-operative Urban Bank Ltd., Khammam, Telangana (the bank) for non-compliance with the directions issued by RBI on ‘Board of Directors – UCBs’ read with the directions issued by RBI on ‘Loans and advances to directors, their relatives, and firms/concerns in which they are interested’.
The Reserve Bank of India (RBI) imposed a monetary penalty of Rs 25,000 on the Subramanianagar Co-operative Urban Bank Ltd., Salem, Tamil Nadu (the bank) for non-compliance with the directions issued by RBI on ‘Board of Directors – UCBs’ read with the directions issued by RBI on ‘Loans and advances to directors, their relatives, and firms/concerns in which they are interested’.
The penalties have been imposed in exercise of powers conferred on RBI under the provisions of Section 47A(1)(c) read with Sections 46(4)(i) and 56 of the Banking Regulation Act, 1949 (AACS).
The action is based on deficiencies in regulatory compliance and is not intended to pronounce upon the validity of any transaction or agreement entered into by the bank with its customers.
