Recorded RBI impact
Fine: Rs 1.00 L
Monetary penalty · Fresh imposition
Published by RBI
21 Feb 2022
Case Brief
The Reserve Bank of India imposed a monetary penalty of ₹1 lakh on Chennai Central Co-operative Bank Ltd., Chennai, Tamil Nadu by order dated February 17, 2022. The penalty was imposed for non-adherence / violation of RBI directions contained in the June 22, 1996 circular on Income Recognition, Assets Classification, Provisioning and Other Related Matters. RBI said the bank's inspection report for its financial position as on March 31, 2020 revealed non-compliance; after a show-cause notice, reply, and oral submissions, the charge was found substantiated. The action was taken under Section 47A(1)(c) read with Section 46(4)(i) and Section 56 of the Banking Regulation Act, 1949.
Why RBI Acted
RBI imposed a monetary penalty after an inspection report for the bank's financial position as on March 31, 2020 revealed violations / non-compliance with RBI directions in the June 22, 1996 circular on Income Recognition, Assets Classification, Provisioning and Other Related Matters. The bank was issued a show-cause notice; after considering its reply and oral submissions at personal hearing, RBI concluded the charge of non-compliance was substantiated and warranted penalty under Section 47A(1)(c) read with Section 46(4)(i) and Section 56 of the Banking Regulation Act, 1949.
Operating Impact
The bank must absorb the monetary penalty; no business restriction, suspension, or cancellation was imposed. The action primarily affects the bank and signals RBI's finding of regulatory non-compliance, but it does not itself restrict customer operations.
Regulatory Basis
- Section 47 A (1) (c)
- Section 46 (4) (i)
- Section 56 of the Banking Regulation Act, 1949
Action Facts
- Primary Impact
- Fine: Rs 1.00 L
- Order Date
- 17 Feb 2022
- Effective From
- 17 Feb 2022
- Entities Affected
- 1
- Entity Role
- Primary
- Entity Type
- Co-operative bank