RBI imposes monetary penalty on 5 co-operative banks for rule violation

Reserve Bank of India

The Reserve Bank of India (RBI) on March 21 said it has imposed monetary penalty on five co-operative banks for rule violations.

These banks are Pragati Mahila Nagrik Sahakari Bank, Janata Co-operative Bank, Jila Sahakari Kendriya Bank, Karad Urban Co-operative Bank, and The Kalupur Commercial Co-operative Bank.

The central bank imposed Rs 26.60 lakh on The Kalupur Commercial Co-operative Bank, Rs 13.30 lakh on Karad Urban Co-operative Bank, Rs 5 lakh on Janata Co-operative Bank, Rs 1 lakh on Pragati Mahila Nagrik Sahakari Bank, and Rs 75,000 on Jila Sahakari Kendriya Bank, according to a press release from the central bank.

The Kalupur Commercial Co-operative Bank was penalised as the bank had not transferred eligible amounts to the Depositor Education and Awareness Fund within the prescribed period and renewed two advances to a company in which the relative of a director of the bank was interested, being a major shareholder in the company, release added.

Karad Urban Co-operative Bank was penalised for non-compliance with certain directions issued by RBI on ‘Interest Rate on Deposits’, the RBI said.

Further, penalty on Janata Co-operative Bank was imposed for sanctioning gold loans beyond prescribed regulatory limit under bullet repayment scheme, and sanctioning loans to its nominal members beyond prescribed regulatory limit.