The Reserve Bank of India (RBI) has levied penalties totaling Rs 60.3 lakh on five co-operative banks due to violations of regulatory norms. The monetary fines reflect the RBI's ongoing commitment to enforce compliance and ensure the integrity of the banking sector.
Among the penalties, the District Co-operative Bank in Dehradun received a nominal fine of Rs 2. In contrast, three other banks—The Kangra Co-operative Bank in New Delhi, Rajdhani Nagar Sahkari Bank in Lucknow, and Zila Sahakari Bank in Kotdwar, Uttarakhand—each faced penalties of Rs 5 lakh. The most significant penalty was imposed on Rajkot Nagarik Sahakari Bank, amounting to Rs 43.30 lakh, specifically for non-compliance with RBI directives.
The RBI's actions stem from deficiencies in regulatory adherence by these banks. For Rajkot Nagarik Sahakari Bank, the penalties were a response to multiple failures, including violations concerning loans and advances to directors and their relatives, as well as restrictions on opening savings accounts for certain organizations. The penalties serve to reinforce the importance of adhering to established banking regulations.
While the RBI has not detailed the specific compliance failures for the other four banks, it emphasizes that these penalties are not meant to challenge the validity of any transactions or agreements made between these banks and their customers. Instead, the fines aim to compel banks to rectify their compliance issues and align with regulatory standards.
The RBI maintains a robust framework for enforcing compliance among banks, allowing it to impose monetary penalties when necessary. This recent enforcement action is consistent with the RBI's historical approach, which has seen multiple co-operative banks penalized for similar non-compliance issues in the past.