The Reserve Bank of India wielded its regulatory authority, slapping monetary penalties on four cooperative banks totaling Rs 4.75 lakh, on Monday. The weightiest fine of Rs 2.50 lakh was levied on Pusad Urban Cooperative Bank.
The RBI imposed a monetary penalty of Rs 50 thousand on the Anjangaon Surji Nagari Sahakari Bank Limited, located in Anjangaon Surji, Maharashtra. This sanction was for contravening directives and specific instructions issued by the RBI under sections 35(A)(1) and 36(1) of the Banking Regulation Act, 1949, respectively.
A fine of Rs 75 thousand was imposed on Sri Satya Sai Nagrik Sahakari Bank Maryadit, situated in Bhopal, Madhya Pradesh, for failing to comply with RBI directions concerning ‘Exposure Norms & Statutory/Other Restrictions – UCBs’.
Likewise, the apex bank imposed a hefty fine of Rs 2.50 lakh on Pusad Urban Co-operative Bank Ltd., also located in Pusad, Maharashtra, for flouting RBI directives regarding ‘Income Recognition, Asset Classification, Provisioning and Other Related Matters – UCBs’.
Shillong Co-operative Urban Bank Limited, based in Meghalaya, faced a penalty of Rs 1 lakh for non-compliance with RBI directions on ‘Know Your Customer (KYC) Directions, 2016’.
These penalties were imposed under the authority granted to the RBI under Section 47A(1)(c) read with Sections 46(4)(i) and 56 of the Banking Regulation Act, 1949.
It’s important to note that this regulatory action is a response to shortcomings in compliance and does not intend to adjudicate on the validity of any transactions or agreements between the banks and their customers.
Earlier, Reserve Bank of India imposed monetary penalties on four cooperative banks for breaching the RBI norms. These banks were are Nakodar Hindu Urban Cooperative Bank, Zoroastrian Cooperative Bank, Bombay Mercantile Cooperative Bank and Navnirman Cooperative Bank.
The RBI imposed highest penalty of Rs 63.30 lakh on Bombay Mercantile Co-operative Bank Ltd. (the bank) for non-compliance with the directions issued by RBI on ‘Exposure Norms and Statutory / Other Restrictions – UCBs’, ‘Gold Loan – Bullet Repayment – UCBs’ and ‘Unclaimed Deposits and Inoperative/ Dormant Accounts in UCBs’.