The Reserve Bank of India has imposed, by an order dated January 23, 2023, a monetary penalty of Rs 1.00 lakh on Ilkal Co-operative Bank Ltd., Ilkal, Karnataka.
The UCB was faulted for non-adherence and violation of directions issued on Income Recognition, Asset Classification, Provisioning and Other Related Matters – UCBs.
This 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, says RBI.
The inspection report of the bank based on its financial position as on March 31, 2021, revealed, inter alia, that the bank had incorrectly classified certain non-performing accounts as standard assets. Based on the same, a Notice was issued to the bank advising it to show cause as to why penalty should not be imposed for non-compliance with the directions.