RBI imposes monetary penalty on four co-operative banks for rule violations

The Reserve Bank of India (RBI) on June 5 said it has imposed monetary penalties on four cooperative banks for rule violations.

These banks are Kokan Mercantile Co-operative Bank, Bajirao Appa Sahakari Bank, Sawantwadi Urban Co-operative Bank and Shri Laxmi Sahakari Bank.

The central bank imposed a penalty of Rs 1 lakh each on Kokan Mercantile Co-operative Bank and Shri Laxmi Sahakari Bank. It imposed Rs 2 lakh and Rs 3 lakh penalty on Bajirao Appa Sahakari Bank and Sawantwadi Urban Co-operative Bank, respectively.

The penalty on Kokan Mercantile Co-operative Bank has been imposed as the bank was collecting fixed penal charges for a shortfall in the maintenance of minimum balance in saving bank accounts instead of a charge proportionate to the extent of the shortfall. This was done without giving notice to the effect that in the event of minimum balance not being restored in the account within a month from the date of notice, penal charges will be applicable, the release said.