The Reserve Bank of India has imposed a monetary penalty of Rs 5.00 lakh on The Citizens’ Co-operative Bank Limited, Jammu, Jammu and Kashmir for contravention of section 35 A and section 36 (1) (a) read with section 56 of the Banking Regulation Act, 1949.
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 release reads “The Inspection Report of the bank based on its financial position as on March 31, 2020, revealed, inter alia, non-compliance with specific directions issued to the bank by RBI, on reducing the single and group borrower exposure limit, under a Supervisory Action Framework (SAF). 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 said directions.”
After considering the bank’s reply to the notice and additional information furnished thereto, RBI came to the conclusion that the aforesaid charge of non-compliance with RBI directions was substantiated and warranted imposition of monetary penalty, concluded the release.