RBI Penalises Five Co-Operative Banks, Check Details Here

The Reserve Bank of India (RBI) has imposed penalties totalling Rs 60.3 lakh on five cooperative banks for breaching various regulatory norms.

Rajkot Nagarik Sahakari Bank

Rajkot Nagarik Sahakari Bank has been fined ?43.30 lakh for failing to comply with RBI directives regarding the prohibition on extending loans and advances to directors and their relatives, as well as firms or concerns in which they have interests. Additionally, the bank was penalized for contravening rules regarding the opening of savings bank accounts in the names of certain bodies or organizations, and for deficiencies in deposit account maintenance.

Kangra Co-operative Bank

Indian currency | Photo: BCCL

The Kangra Co-operative Bank (New Delhi), Rajdhani Nagar Sahkari Bank (Lucknow), and Zila Sahakari Bank, Garhwal (Kotdwar, Uttarakhand) each face a monetary penalty of ?5 lakh.

Co-operative Bank

Furthermore, the District Co-operative Bank (Dehradun) has been fined ?2 lakh.

Also Read: RBI Penalises Five Co-Operative Banks, Check Details Here

RBI clarified that these penalties are imposed due to shortcomings in regulatory compliance and do not serve as a judgment on the validity of any transactions or agreements made by the banks with their customers.

RBI fined IDFC First Bank and LIC in April

Earlier this month, the Reserve Bank of India (RBI) also fined IDFC First Bank, a private sector lender, Rs 1 crore for not following certain rules set by the regulator on Loans and Advances. The bank approved term loans for infrastructure projects run by a public sector company without properly checking if the projects were viable and could generate enough revenue to pay back the loans. Instead of using funds specifically set aside for the projects, the bank used general budgetary resources to repay or service these loans, according to RBI's statement. In another regulatory action, RBI fined LIC Housing Finance Ltd Rs 49.70 lakh for not following certain rules outlined in the Fair Practices Code.

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