RBI Slaps Rs5 Lakh Penalty on Parbhani District Central Cooperative Bank
Moneylife Digital Team 17 January 2025
Reserve Bank of India (RBI) has imposed a penalty of Rs5 lakh on Parbhani District Central Cooperative Bank (DCC) Ltd from Maharashtra for contravention of provisions of Section 20 and Section 26A of the Banking Regulation Act (BR Act).
 
The statutory inspection of Parbhani DCC Bank was conducted by the National Bank for Agriculture and Rural Development (NABARD) with reference to its financial position as of 31 March 2023. The inspection revealed that the lender had sanctioned a director-related loan.
 
Additionally, it was found that Parbhani DCC Bank had failed to transfer the eligible amount to the depositor education and awareness fund (DEA Fund) within the prescribed time.
 
After considering the lender’s reply to the notice, oral submissions made during the personal hearing and examination of additional submissions made by it, RBI says the charges against the lender were sustained, warranting imposition of monetary penalty.
 
However, the banking regulator clarified that its action against Parbhani DCC Bank is based on deficiencies in regulatory compliance and is not intended to pronounce on the validity of any transactions or agreements entered into by the Bank with its customers. Further, imposition of a monetary penalty is without prejudice to any other action that may be initiated against the Bank, RBI added.
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