The Reserve Bank of India (RBI) has imposed a monetary penalty of Rs 5 lakh on The Bharat Co-operative Bank Ltd., Bengaluru for non-compliance and violation of the directions issued under Exposure Norms and Statutory Restrictions. RBI said the penalty was imposed through a letter dated November 28. The central bank said the penalty has been imposed in exercise of powers vested in the RBI under the provisions of section 47A(1)(c) read with section 46(c). 4) (i) and Section 56 of the Banking Regulation Act, 1949 (AACS), in view of the bank’s failure to comply with the above directions issued by RBI.
“This action is based on deficiencies in regulatory compliance and is not intended to pronounce upon the validity of any transaction or agreement entered into by the bank with its customers,” the central bank said.
Giving details of its inspection report of the bank, the RBI said that, “On the basis of its financial position as on March 31, 2020 and March 31, 2021, it is observed, inter alia, that the commercial paper bank has violated the prudential individual exposure limit. 15% of capital funds. Based on the same, a notice was issued to the bank advising it to show cause that penalty for non-compliance of directions Why not apply
“After considering the bank’s reply and oral submissions made during the personal hearing, RBI came to the conclusion that the allegation of non-compliance with RBI directions was warranted and imposed monetary penalty,” RBI said.
On November 21, the RBI had imposed a penalty on Bharat Sahakari Bank, Mumbai over regulatory non-compliance. “The statutory inspection of the bank conducted by RBI with reference to its financial position as on March 31, 2020, and examination of risk assessment reports, inspection reports and all related correspondence thereon, revealed that the bank has classified certain accounts as non-performing as per IRAC norms. not classified as performing assets. Further to the same, a notice was issued to the bank, advising it to show cause as to why penalty should not be imposed for violation of RBI directions. As stated therein has been done,” the RBI said in a November 28 release.
