Urban Co-operative Bank Ltd., Cuttack – Penalised
Case Brief
The Reserve Bank of India imposed a monetary penalty of Rs 1.00 lakh on Urban Co-operative Bank Ltd., Cuttack under Section 47(A)(1)(b) read with Section 46(4) of the Banking Regulation Act, 1949 (AACS). The penalty was imposed because the bank opened four collection counters without prior RBI approval, and RBI concluded the violation was substantiated after considering the bank's written reply to the show-cause notice.
RBI imposed a monetary penalty under Section 47(A)(1)(b) read with Section 46(4) of the Banking Regulation Act, 1949 (AACS) because the bank opened four collection counters without obtaining prior approval from the Reserve Bank of India. The bank replied to the show-cause notice, but RBI found the violation substantiated and warranted penalty.
Severity Assessment
A Rs 1 lakh penalty falls in the lowest monetary band, so severity is 1.
The bank must absorb the monetary penalty and the finding of regulatory non-compliance. The action does not describe any operational restriction, but it signals RBI scrutiny over the bank's compliance with approval requirements for new collection counters.
Published as Urban Co-operative Bank Ltd., Cuttack
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