Baran Nagrik Sahkari Bank Ltd., Baran, Rajasthan

RBI imposed a monetary penalty on Baran Nagrik Sahkari Bank Ltd., Baran, Rajasthan for contravention of Section 35A read with Section 56 of the Banking Regulation Act, 1949. The inspection report for the bank’s financial position as on March 31, 2021 found that it was not complying with RBI directions prohibiting grant of loans/advances/any other financial accommodation to relatives of its directors and was also not reporting the same in the OSS-6 return to RBI. After a show-cause notice and consideration of the bank’s reply, RBI concluded the charge was substantiated and warranted penalty under Section 47A(1)(c) read with Section 46(4)(i) and Section 56 of the Act.

The bank must pay the monetary penalty and address the compliance deficiencies identified by RBI. The release does not impose an ongoing operational restriction, but it highlights deficiencies in lending controls and regulatory reporting that the bank must correct going forward.