The Reserve Bank of India imposed a monetary penalty of Rs 44.00 lakh on the Kalupur Commercial Co-operative Bank Ltd., Ahmedabad for non-compliance with its directions.
The leading UCB of Gujarat was faulted for non-compliance with directions issued by RBI on ‘Interest Rate on Deposits’ and on ‘Frauds in UCBs: Changes in Monitoring and Reporting mechanism’.
This action is based on deficiency 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, clarifies the RBI.
A notice was issued to the bank advising it to show cause as to why penalty should not be imposed for contravention of the RBI directions.
After considering the bank’s reply to the notice, oral submissions made during the personal hearing and examination of additional submissions made by it, RBI came to the conclusion that the aforesaid charge of non-compliance with the aforesaid RBI directions was substantiated and warranted imposition of monetary penalty.