RBI slaps fine on 9 co-operative banks for violating norms

The Reserve Bank of India (RBI) on Monday said it has imposed monetary penalties on nine co-operative banks from six states for violating norms. The list includes The Berhampur Cooperative Urban Bank and The Kendrapara Urban Co-operative Bank from Odisha, Santrampur Urban Co-operative Bank and The Nawanagar Co-operative Bank from Gujarat, Krishna Mercantile Co-operative Bank and Jila Sahakari Kendriya Bank Maryadit from Madhya Pradesh.

Among others, the central banks also slapped fines on Jharkhand-based The Jamshedpur Urban Cooperative Bank, Renuka Nagarik Sahakari Bank Maryadit (Chhattisgarh), and Osmanabad Janata Sahakari Bank (Maharashtra).

“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,” RBI said in a notification.

As per the notification issued by the RBI, a maximum penalty of ₹3.10 lakh has been imposed on The Berhampur Cooperative Urban Bank (Odisha) for non-compliance with the directions issued by the central bank on Know Your Customer (KYC) norms, exposure and statutory guidelines, and depositor education and awareness fund.

A fine of ₹2.50 lakh has been slapped on Osmanabad Janata Sahakari Bank (Maharashtra) for non-compliance on KYC norms, followed by ₹2 lakh on The Santrampur Urban Co-operative Bank (Gujarat) for flouting norms on ‘Maintenance of Statutory Reserves – Cash Reserve Ratio (CRR) and Statutory Liquidity Ratio (SLR) by Primary (Urban) Co-operative Banks’. 

Similarly, a monetary penalty of ₹1 lakh each has been imposed on Renuka Nagarik Sahakari Bank Maryadit, Ambikapur (Chhattisgarh) and Jila Sahakari Kendriya Bank Maryadit, Balaghat (M.P) for violating direction issued by the RBI to urban co-operative banks.

Besides, a monetary penalty of ₹1 lakh has been slapped on The Jamshedpur Urban Cooperative Bank (Jharkhand) for failing to adhere to specific directions under the supervisory action framework (SAF).

Among others, a fine of ₹50,000 each has been levied on The Kendrapara Urban Co-operative Bank (Odisha) and Bhopal-based Krishna Mercantile Co-operative Bank for breaching certain norms. 

Meanwhile, ₹25,000 fine has been imposed on The Nawanagar Co-operative Bank Ltd., Jamnagar (Gujarat) for contravention of directions on loans and advances.

The actions were taken based on the assessment of the financial position of the urban co-operative banks and their adherence to the various provisions of the Act and directions issued there under.