Recorded RBI impact
Fine: Rs 50,000
Monetary penalty · Fresh imposition
Published by RBI
10 Oct 2018
Case Brief
The Reserve Bank of India imposed a monetary penalty of ₹50,000 on Mathura Zila Sahkari Bank Ltd., Mathura, Uttar Pradesh under Section 47A(1)(c) read with Section 46(4) of the Banking Regulation Act, 1949 (as applicable to co-operative societies). The bank was found to have violated RBI instructions/guidelines on restriction on holding shares in other co-operative societies under Section 19 of the Act. RBI had issued a show-cause notice, considered the bank’s written reply, and concluded that the violations were substantiated.
Why RBI Acted
RBI imposed a monetary penalty under Section 47A(1)(c) read with Section 46(4) of the Banking Regulation Act, 1949 (as applicable to co-operative societies) after concluding that Mathura Zila Sahkari Bank Ltd. had violated RBI instructions/guidelines relating to restriction on holding shares in other co-operative societies under Section 19 of the Act. The bank had submitted a written reply to the show-cause notice, but RBI found the violations substantiated and warranting penalty.
Operating Impact
The bank must absorb the penalty and the order serves as an enforcement action for past non-compliance. No direct operational restriction is described in the release, but the finding reflects a compliance lapse relevant to co-operative society shareholding/exposure rules.
Regulatory Basis
- Section 47A(1)(c) read with Section 46(4) of the Banking Regulation Act, 1949 (As Applicable to Co-operative Societies)
- Section 19 of the Act, ibid
Action Facts
- Primary Impact
- Fine: Rs 50,000
- Entities Affected
- 1
- Entity Role
- Primary
- Entity Type
- Co-operative bank