Recorded RBI impact
Fine: Rs 1.00 L
Monetary penalty · Fresh imposition
Published by RBI
18 Oct 2024
Case Brief
The Reserve Bank of India imposed a monetary penalty of ₹1.00 lakh on Andhra Pragathi Grameena Bank, Andhra Pradesh, by order dated October 10, 2024. The penalty followed supervisory findings from a NABARD inspection for the bank’s financial position as on March 31, 2023, which showed non-compliance with RBI directions on prudential norms, provisioning, asset classification and exposure limits, read with IRAC norms. RBI specifically found that certain loan accounts were not classified as non-performing assets in accordance with the applicable norms. The action was taken under section 47A(1)(c) read with sections 46(4)(i) and 51(1) of the Banking Regulation Act, 1949.
Why RBI Acted
RBI imposed a monetary penalty after supervisory inspection findings showed non-compliance with its directions on ‘Strengthening of Prudential Norms- Provisioning Asset Classification and Exposure Limit’ read with the IRAC norms. The sustained charge was that the bank had not classified certain loan accounts as non-performing assets in accordance with the IRAC norms. The penalty was imposed under section 47A(1)(c) read with sections 46(4)(i) and 51(1) of the Banking Regulation Act, 1949.
Operating Impact
The bank must absorb the monetary penalty and remain subject to RBI supervision. The order does not itself bar operations or alter customer contracts, but it signals continued regulatory scrutiny and may lead to further action if similar compliance lapses recur. ग्राहकों/borrowers are not directly affected by an operational restriction from this release, though the bank must improve asset classification compliance going forward.
Regulatory Basis
- section 47A(1)(c) read with sections 46(4)(i) and 51(1) of the Banking Regulation Act, 1949
Action Facts
- Primary Impact
- Fine: Rs 1.00 L
- Order Date
- 10 Oct 2024
- Effective From
- 10 Oct 2024
- Entities Affected
- 1
- Entity Role
- Primary
- Entity Type
- Bank