RBI imposes monetary penalty on co-operative banks

The release stated these banks are the Bassein Catholic Co-operative Bank, the Tirumangalam Co-operative Urban Bank, The Tirupattur Urban Co-operative Bank, the Nagpur Nagarik Sahakari Bank, and The Himachal Pradesh State Co-operative Bank.

The Reserve Bank of India (RBI) has taken action against five co-operative banks for violations of rules and regulations.

Banks Penalized

The co-operative banks facing penalties include Bassein Catholic Co-operative Bank, Tirumangalam Co-operative Urban Bank, The Tirupattur Urban Co-operative Bank, Nagpur Nagarik Sahakari Bank, and The Himachal Pradesh State Co-operative Bank.

Penalty Details

• Bassein Catholic Co-operative Bank: A penalty of Rs 61.60 lakh was imposed for various infractions, including delays in reporting frauds, failure to conduct periodic risk categorization reviews, and levying penal charges for non-maintenance of minimum balances.
• Nagpur Nagarik Sahakari Bank: The bank was fined Rs 28.30 lakh for failing to pay interest on certain term deposits on holidays, non-business days, or Sundays, among other violations.
• The Himachal Pradesh State Co-operative Bank: A penalty of Rs 5 lakh was imposed for undisclosed violations.
• Tirumangalam Co-operative Urban Bank and The Tirupattur Urban Co-operative Bank: Each bank was fined Rs 25,000 for rule violations.

Reasons for Penalties

The penalties were imposed for a range of infractions, including delays in reporting frauds, failure to conduct periodic reviews, levying penal charges, and improper handling of term deposits.

Conclusion

The RBI’s actions underscore the importance of adherence to regulatory guidelines by co-operative banks to maintain financial integrity and protect depositor interests.