RBI imposes monetary penalty on Lucknow University Primary Co-operative Bank Ltd., Lucknow, Uttar Pradesh
Case Brief
RBI, by order dated September 13, 2024, imposed a monetary penalty of ₹3.00 lakh on Lucknow University Primary Co-operative Bank Ltd., Lucknow. The penalty followed a statutory inspection and show-cause proceedings that found non-compliance with RBI’s direction on investments by Primary (Urban) Co-operative Banks, including breach of prudential inter-bank (gross) and counterparty exposure limits, under the Banking Regulation Act, 1949.
RBI imposed a monetary penalty after a statutory inspection and subsequent show-cause process found non-compliance with its direction on ‘Investments by Primary (Urban) Co-operative Banks’. The sustained charge was non-adherence to prudential inter-bank (gross) and counterparty exposure limits, in exercise of powers under section 47A(1)(c) read with sections 46(4)(i) and 56 of the Banking Regulation Act, 1949.
Severity Assessment
This is a monetary penalty of Rs 3 lakh, which falls in the lowest monetary band and does not involve an operational restriction.
The bank must absorb the penalty and address the compliance deficiencies identified by RBI, particularly around investment and exposure-limit adherence. The order does not invalidate any customer transaction, but RBI may initiate further action if warranted.
Published as Lucknow University Primary Co-operative Bank Ltd., Lucknow
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