The Reserve Bank of India imposed a monetary penalty on four cooperative banks on Thursday for non-compliance with RBI’s directions as well as due to flouting of ‘Know your Customer (KYC) norms’.
These banks are Vaishali District Cooperative Bank, Sree Harihareshwara Urban Cooperative Bank, Chandrapur District Central Cooperative Bank and Vizianagaram District Cooperative Bank.
The Reserve Bank of India imposed a monetary penalty of Rs 1.00 lakh on the Vaishali District Central Co-operative Bank Ltd., Bihar (the bank) for non-compliance with certain directions issued by RBI on ‘Know your Customer (KYC) norms’.
A monetary penalty of Rs 50,000 has been imposed on Sree Harihareshwara Urban Co-operative Bank Limited, Harihar, Karnataka (the bank) for non-compliance with certain directions issued by RBI on ‘Exposure Norms and Statutory/Other Restrictions ? UCBs’.
Besides, A penalty of 2.50 lakh has been imposed on Chandrapur District Central Co-operative Bank Limited, Chandrapur, Maharashtra (the bank) for contravention of the provisions of section 20 read with section 56 of the Banking Regulation Act, 1949 (BR Act).
The Reserve Bank of India also imposed a monetary penalty of Rs 50,000 on the District Co-operative Central Bank Limited, Vizianagaram, Andhra Pradesh (the bank) for non-compliance with certain directions issued by The National Bank for Agriculture and Rural Development (NABARD) on ‘Frauds – Guidelines for Classification, Reporting and Monitoring’.
This penalty has been imposed in exercise of powers vested in RBI, conferred under section 47A(1)(c) read with sections 46(4)(i) and 56 of the Banking Regulation Act, 1949.
RBI clarifies that the 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. Further, imposition of this monetary penalty is without prejudice to any other action that may be initiated by RBI against the bank, it added.
Last week RBI had imposed a monetary fine on three cooperative banks, with a hefty fine of Rs 5.93 crore imposed on the leading bank of Gujarat, Mehsana Urban Cooperative Bank.
The other two banks on the list are Pusad Urban Cooperative Bank and Jilla Sahakari Kendriya Bank, Chhattarpur, each fined Rs 2.50 lakh.