Recorded RBI impact
Fine: Rs 2.00 L
Monetary penalty · Fresh imposition
Published by RBI
24 Dec 2021
Case Brief
The Reserve Bank of India imposed a monetary penalty of ₹2 lakh on Chiplun Urban Co-operative Bank Ltd., Ratnagiri, by order dated December 20, 2021. The penalty was imposed under Section 47A(1)(c) read with Section 46(4)(i) and Section 56 of the Banking Regulation Act, 1949, for contravention of RBI's directions on Exposure Norms and Statutory / Other Restrictions – UCBs. RBI said the bank had failed to adhere to the ceiling on advances to nominal members in certain cases, based on inspection findings for the bank's financial position as on March 31, 2020. RBI considered the bank's reply and submissions before concluding that the non-compliance was substantiated and warranted penalty.
Why RBI Acted
RBI imposed a monetary penalty under Section 47A(1)(c) read with Section 46(4)(i) and Section 56 of the Banking Regulation Act, 1949, after the bank failed to comply with RBI directions on Exposure Norms and Statutory / Other Restrictions – UCBs. The inspection report for the bank's financial position as on March 31, 2020 found that it had not adhered to the ceiling on advances to nominal members in certain cases. After considering the bank's written reply, oral submissions, and additional documentary evidence, RBI held the charge substantiated and imposed the penalty.
Operating Impact
The bank must bear the monetary penalty and remains expected to comply with RBI's exposure norms and related restrictions going forward. The action does not invalidate customer transactions, but it signals regulatory non-compliance by the bank.
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 2.00 L
- Order Date
- 20 Dec 2021
- Effective From
- 20 Dec 2021
- Entities Affected
- 1
- Entity Role
- Primary
- Entity Type
- Co-operative bank