RBI Slaps Rs11.50 Lakh Penalty on 3 Cooperative Banks from Uttar Pradesh
Moneylife Digital Team 22 May 2024
Reserve Bank of India (RBI) has imposed a penalty of Rs11.50 lakh on three cooperative banks from Uttar Pradesh (UP) for non-compliance with the directions issued by the banking regulator. A maximum penalty of Rs7 lakh has been imposed on Urban Cooperative Bank Ltd.
 
The other cooperative banks penalised by RBI are: Noida Commercial Cooperative Bank Ltd and Bhadohi Urban Cooperative Bank Ltd
 
Urban Cooperative Bank has been penalised for contravention of the provisions of Section 26 A (2) of the Banking Regulation Act (BR Act), for non-compliance with the specific directions issued by RBI under supervisory action framework (SAF) on investments by primary (Urban) cooperative banks (UCBs).
 
RBI's statutory inspection revealed that Urban Cooperative Bank had not transferred eligible amounts to the depositor education and awareness fund (DEAF) within the prescribed period. The Bank also offered interest rates higher than those offered by the State Bank of India (SBI) on deposits of various tenors and sanctioned fresh loans and advances carrying risk weights more than 100% in violation of specific instructions issued under SAF and breached the prudential inter-bank exposure limit on a gross as well as counterparty basis.
 
Noida Commercial Cooperative Bank was fined Rs2.50 lakh  for contravention of the provisions of Section 26 A (2) of the BR Act and for non-compliance with the directions issued by RBI on loans and advances to directors, their relatives and firms or concerns in which they are interested and master circular on frauds - classification and reporting. RBI found that the Bank had not transferred eligible amounts to DEAF within the prescribed period, sanctioned a director related loan and not classified and reported a fraud.
 
Bhadohi Urban Cooperative Bank was penalised Rs2 lakh for contravention of the provisions of Section 26 A (2) of the BR Act. RBI found that the Bank had not transferred eligible amounts to DEAF within the prescribed period.
 
RBI, however, clarifies that its action against these three banks is based on deficiencies in regulatory compliance and not intended to pronounce on the validity of any transaction or agreement entered into by the banks with their customers.
Comments
100 Top-listed Companies To Follow ISF from 1st June To Verify Market Rumours
Moneylife Digital Team 21 May 2024
Securities and Exchange Board of India (SEBI) has asked the top 100 listed companies to follow from 1 June 2024 the industry standards to verify market rumours under Regulation 30(11) of SEBI (Listing Obligations and Disclosure...
IBBI Suspends Resolution Professional Anil Goel for 1 Year for Suppressing Information from MP RERA in AG8 Ventures Case
Moneylife Digital Team 20 May 2024
The Insolvency and Bankruptcy Board of India (Board/IBBI) has suspended the registration of Anil Goel, an insolvency professional (IP), for failing to provide information to Madhya Pradesh Real Estate Regulatory Authority (MP-RERA)...
Reliance Commercial Finance: NFRA Slaps Rs2.50 Crore Penalty on Shridhar & Associates and CA Ajay Vastani
Moneylife Digital Team 20 May 2024
Holding an audit firm and a chartered accountant (CA) guilty of professional misconduct, the national financial reporting authority (NFRA) imposed a penalty of Rs2.50 crore on them for showing negligence in the audit of Reliance...
RBI Slaps Rs59.10 Lakh Penalty on Karnataka Bank for Opening Deposit Accounts of Illegal Entities
Moneylife Digital Team 20 May 2024
Reserve Bank of India (RBI) has imposed a penalty of Rs59.10 lakh on Karnataka Bank Ltd for violating directions on interest rate on deposits and prudential norms on income recognition, asset classification and provisioning pertaining...
Array
Free Helpline
Legal Credit
Feedback