Recorded RBI impact
Fine: Rs 1.00 L
Monetary penalty · Fresh imposition
Published by RBI
30 Jul 2021
Case Brief
RBI imposed a monetary penalty of ₹1.00 lakh on Innespeta Cooperative Urban Bank Ltd., Rajahmundry, East Godavari District, Andhra Pradesh, by order dated July 29, 2021. The penalty was imposed for contravention of / non-compliance with certain provisions of RBI’s Master Circular on Board of Directors – UCBs dated July 1, 2015, after a special scrutiny, show-cause notice, and consideration of the bank’s written reply and oral submissions. RBI stated the action was based on deficiencies in regulatory compliance and did not pronounce on the validity of any customer transactions or agreements.
Why RBI Acted
A special scrutiny conducted by RBI revealed contravention of / non-compliance with the directions issued by RBI on "Board of Directors - UCBs". RBI issued a show-cause notice, considered the bank’s written reply and oral submissions in personal hearing, and concluded that the charges were substantiated, warranting a monetary 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 penalty and address the governance/compliance lapses identified by RBI. The order does not impose an operational restriction on customers, but it signals heightened regulatory scrutiny over board-related compliance.
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
- 29 Jul 2021
- Effective From
- 29 Jul 2021
- Entities Affected
- 1
- Entity Role
- Primary
- Entity Type
- Co-operative bank