Case Brief
What Happened
By an order dated October 03, 2024, RBI imposed a monetary penalty of ₹14.00 lakh on Arunachal Pradesh Rural Bank. The action was taken for non-compliance with RBI directions on strengthening of prudential norms, including provisioning, asset classification and exposure limits, as well as Know Your Customer requirements. RBI's inspection, conducted by NABARD with reference to the bank's position as on March 31, 2023, found that the bank had failed to classify certain loan accounts as NPAs, leading to divergence in asset classification, and had allotted multiple UCICs to individual customers. The penalty was imposed under the Banking Regulation Act after notice, reply, and personal hearing.