Recorded RBI impact
Fine: Rs 2.00 L
Monetary penalty · Fresh imposition
Published by RBI
12 Dec 2022
Case Brief
The Reserve Bank of India imposed a monetary penalty of Rs 2 lakh on Indore Premier Co-operative Bank Ltd., Indore (M.P.), by order dated December 05, 2022. RBI said the bank had contravened section 19 read with section 56 of the Banking Regulation Act, 1949 by not complying with directions on the extent and conditions for holding shares in another co-operative society. The penalty was levied under section 47A(1)(c) read with section 46(4)(i) and section 56 of the Act after the bank's replies and submissions were considered.
Why RBI Acted
RBI imposed a monetary penalty after inspection findings showed that Indore Premier Co-operative Bank Ltd. did not comply with RBI directions specifying the extent and conditions subject to which co-operative banks were permitted to hold shares in any other co-operative society. The bank was found to have contravened section 19 read with section 56 of the Banking Regulation Act, 1949, and the penalty was imposed under section 47A(1)(c) read with section 46(4)(i) and section 56 of the Act.
Operating Impact
The bank must absorb the penalty and ensure future compliance with RBI directions on shareholding in other co-operative societies and the relevant provisions of the Banking Regulation Act. No broader operational restriction was imposed, but the compliance lapse may affect regulatory scrutiny going forward.
Regulatory Basis
- section 19 read with section 56 of the Banking Regulation Act, 1949
- Section 47 A (1) (c) read with Section 46 (4) (i) and Section 56 of the Act
Action Facts
- Primary Impact
- Fine: Rs 2.00 L
- Order Date
- 5 Dec 2022
- Effective From
- 5 Dec 2022
- Entities Affected
- 1
- Entity Role
- Primary
- Entity Type
- Co-operative bank