The Reserve Bank of India (RBI) has imposed monetary sanctions for eight Indian banks.
Chhattisgarh Rajya Sahakari Bank, The Goa State Co-operative Bank, Garhaa Co-Operative Bank, The Yavatmal Urban Co-operative Bank, Jila Sahakari Kendriya Bank, Warud Urban Co-operative Bank, Indapur Urban Co-operative Bank as well as The Mehsana Urban Co-operative Bank were among the eight banks.
The penalties that were imposed on these banks ranged from Rs 1 lakh up to 40 lakh rupees.
In addition the RBI issued a monetary fee for Spandana Sphoorty Financial, an NBFC.
Chhattisgarh Rajya Sahakari Bank Maryadit, Raipur:
The Reserve Bank of India imposed an amount of Rs 25 lakh as a penalty on this bank due to its failure to adhere to certain requirements in the ‘Reserve Bank India (Know Your Customer (KYC)) Instructions in 2016’.
The fine is the result of a lawful inspection by NABARD concerning the financial condition of the bank on March 31st in 2020.
In the Inspection Report and examination of all correspondence related to it showed the fact that the bank was unable to establish a system for regular review of risk categorization, as per the RBI.
The Goa State Co-operative Bank, Panaji:
The central bank fined the bank 2.51 lakh because it did not comply with Section 9 of Section 56, of the Banking Regulation Act, 1949. (the Act).
The bank did not eliminate the non-banking asset within the stipulated time frame at the time of acquisition, as per the report.
Garha Co-operative Bank Limited, Guna (M.P. ):
The bank was penalized by a fine of Rs 1 lakh due to its failure to comply with RBI’s guidelines regarding income recognition and asset classification given for urban cooperative banks (IRAC).
The fine was imposed after an inspection report on the bank’s financial condition at March 31, 2019.
The report identified among other things non-compliance with RBI’s directives that were issued in the direction to Urban Cooperative Banks on Income Recognition and Asset Classification (IRAC).
The Yavatmal Urban Co-operative Bank Limited, Yavatmal (Maharashtra):
The RBI has imposed a penalty of 3.50 lakh on the bank. 3.50 lakh to the bank for not being able to follow the RBI’s Know Your Customer guidelines given to cooperative banks in urban areas (KYC).
The sanction was imposed following an inspection report that based on the bank’s financial situation at April 31, 2020, revealed that, among other things, there was not performed periodic updating of KYC of its clients and (ii) the bank had no system of regular review of risk categorization for accounts, in contravention of/non-compliance in accordance with RBI KYC directions.
Jila Sahakari Kendriya Bank Maryadit, Chhindwara (M.P. ):
The Reserve Bank of India (RBI) issued a fine of Rs . 1 lakh to the bank over its failure to follow the requirements that are in Banking Regulation Act, 1949 (the Act) and Reserve Bank of India (RBI) instructions on Knowing Your Customer (KYC).
An inspection report for the bank’s operations revealed that (i) the bank was in the process of delaying the in submitting statutory/OSS returns for RBI as well as NABARD, (ii) did not perform a periodic examination of the risk classification for its customers as well as (iii) didn’t conduct periodic updates of KYC of its clients, in violation of or non-compliance with regulations of the Act regarding the submission of returns and directions issued by the RBI/NABARD and their directions regarding KYC and KYC.
Warud Urban Co-operative Bank Ltd., Warud (Maharashtra):
The RBI has imposed a penalty of Rs . 1 lakh to the bank due to its failure to abide by the RBI’s directives for Urban Co-operative Banks on Exposure Limitations and Statutory/Other Restrictions as well as the requirement to Know Your Client (KYC).
Its Risk Assessment Report, based on its financial situation at the 31st of March, 2021 disclosed among other things there was evidence that the company had not been in compliance with the prudential interbank counterparty limitation and (ii) did not have in place a solid software to identify and the reporting of suspicious transactions that were in violation of guidelines of the RBI on disclosure norms and other restrictions on U.S.-based banks and Knowing Your (KYC).
Indapur Urban Cooperative Bank Ltd., Indapur, Maharashtra:
The bank imposed a 7 lakh penalty on the bank for a violation of the guidelines of the RBI on Exposure Norms , Statutory/Other Restrictions UCBs.
Its Inspection Report, based on its financial situation at the 31st of March, 2021 found that it granted unsecure advances that were that were in excess of the total maximum for such advances. These advances were able to be applied to.
The Mehsana Urban Co-operative Bank Ltd., Mehsana, Gujarat:
The central bank has fined the bank 40 lakh because it did not adhere to certain requirements that are part of Reserve Bank of India (Co-operative Banks the Interest Rate for Deposits) Directions, 2016.
An inspection report revealed that the bank failed to pay interest on I term deposits that matured on Sundays/holidays/non-business working days and were repaid on the next working day, for the intervening days, (ii) balance amount lying in current accounts of deceased individual depositors/proprietorship concerns, from the date of their death to the date of repayment to their claimants, and (iii) term deposits that remained unclaimed after m
Spandana Sphoorty Financial:
Infractions to certain conditions that are in “Non-Banking Financial Company – Systemically Important Non-Deposit taking Company and Deposit taking Company (Reserve Bank) Directions, 2016” resulted in a penalty of Rs 2.33 crore.
After an inspection Following an inspection, the RBI took the decision to impose the fine after determining that the company was in violation of the rules for pricing of microfinance credit for non-banking financial companies and institutions.