- RBI has taken strict action on violation of rules.
- Let us know why the Reserve Bank has taken this action?
- RBI Action: The Reserve Bank of India has taken decisive action against two cooperative banks for various violations.
- Some of these banks failed to comply with KYC regulations, while others breached loan-related rules.
- Following the confirmation of these allegations, the RBI has imposed significant monetary fines.
RBI has taken strict action on violation of rules. Penalty has been imposed on two banks. Let us know why the Reserve Bank has taken this action?
RBI Action: The Reserve Bank of India has taken decisive action against two cooperative banks for various violations. Some of these banks failed to comply with KYC regulations, while others breached loan-related rules. Following the confirmation of these allegations, the RBI has imposed significant monetary fines.
Specifically, Mukkuperi Co-operative Urban Bank Limited in Tamil Nadu has been fined Rs 1.75 lakh. Meanwhile, Parbhani District Central Cooperative Bank Limited in Maharashtra faces a fine of Rs 5 lakh for its regulatory infractions.
Show cause notice was issued to the banks? (RBI Monetary Penalty)
During the statutory inspection carried out by the RBI regarding the financial condition of the bank, the RBI identified negligence in adhering to the rules. Consequently, the central bank issued a show cause notice to both banks. Following the responses to the notice and additional investigations, it was determined that a monetary penalty would be imposed.
What is the reason? (Bank News)
Mukkuperi Co-operative Urban Bank Limited did not follow the instructions issued under SAF, increasing the risk in an area where the level of NPA was high. The bank also failed to upload the KYC records of customers to the central KYC record registry within the prescribed time limit. Parbhani District Central Cooperative Bank Limited failed to approve loans related to directors. It also failed to transfer the eligible amount to the Depositor Education and Awareness Fund within the prescribed time.