On August 21, the Reserve Bank of India (RBI) said that it has imposed monetary penalties for certain rule violations on three cooperative banks.
According to a press release by the RBI, the banks that have been penalized are Pune-based Walchand Nagar Sahakari Bank, Dahanu Road Janata Co-operative Bank Ltd of Maharashtra and Devika Urban Co-operative Bank Ltd, J&K.
While penalizing the Devika Bank with Rs 3 lakh, the RBI said that inspection of the bank revealed that it had renewed the cash credit facility granted to a sole proprietorship concern whose proprietor was the wife of the director’s brother.
A notice was issued to the bank advising it to show a reason why it should not be penalized for failing to comply with the directions.
After considering the bank’s reply to the notice, the RBI concluded saying that the aforesaid charge of non-compliance with RBI directions was substantiated and warranted the imposition of a monetary penalty.
The RBI penalized the Dahanu Road Janata Bank with Rs 1 lakh saying that the bank, violating specific directions issued under RBI rules had given donation.
Similarly, a notice was issued to the bank advising it to show cause as to why it should not be penalized for failing to comply with the directions
After consideration with the Bank’s reply to the notice, the RBI concluded that the charge of non-compliance with the aforementioned RBI directions was substantiated and warranted the imposition of monetary penalty.
And in the case of Walchand Nagar Sahakari bank, the RBI imposed a Rs 4 lakh penalty saying that the bank had not conducted periodic review of risk categorisation of accounts and had failed to allot Unique Customer Identification Code to individual customers.
A notice was issued to the bank advising it to show reason as to why it should not be penalized for failing to comply with the directions.
After consideration of the bank’s reply to the notice, the RBI concluded that the aforementioned charge of non-compliance with RBI directions was substantiated and warranted the imposition of a monetary penalty.
