The Reserve Bank of India (RBI) has imposed monetary penalties on the Greater Bombay Co-operative Bank Ltd and the Jalna People’s Co-operative Bank Ltd for non-compliance of directions from the central bank to urban co-operative banks (UCBs).
In a statement on Friday, the RBI said that it has imposed a monetary penalty of Rs 25 lakh on The Greater Bombay Co-operative Bank Ltd, Mumbai for “non-compliance with directions issued by it on “Frauds in UCBs: Changes in monitoring and reporting mechanism”.
In case of the Jalna People’s Co-operative Bank Ltd, Jalna, the RBI has imposed a fine of Rs 50,000 for contravention of or non-compliance with the directions issued by it to UCBs on “Board of Directors and Exposure Norms & Statutory/Other Restrictions-UCBs”.
“This penalty has been imposed in exercise of powers vested in the RBI under the provisions of Section 47 A (1) (c), read with Section 46 (4) (i) and Section 56 of the Banking Regulation Act, 1949, taking into account the failure of the bank to adhere to the aforesaid directions issued by the RBI,” it said.
In both the cases, the RBI said that the actions are based on deficiencies in regulatory compliance and is not intended to pronounce upon the validity of any transaction or agreement entered into by the banks with its customers.