Recorded RBI impact
Fine: Rs 3.50 L
Monetary penalty · Fresh imposition
Published by RBI
11 May 2021
Case Brief
The Reserve Bank of India imposed a monetary penalty of ₹3.50 lakh on Siddheshwar Sahakari Bank Ltd., Latur, Maharashtra, by an order dated May 10, 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, after RBI found that the bank had contravened or failed to comply with RBI directions issued to Urban Cooperative Banks on Exposure Norms and Statutory/Other Restrictions and on Income Recognition and Asset Classification (IRAC) norms. RBI noted that the action arose from deficiencies in regulatory compliance and was not meant to pronounce on the validity of any transaction or agreement entered into by the bank with its customers.
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 an inspection found contravention/non-compliance with RBI directions applicable to Urban Cooperative Banks on Exposure Norms and Statutory/Other Restrictions and on Income Recognition and Asset Classification (IRAC) norms. RBI stated the action was based on deficiencies in regulatory compliance and not intended to pronounce on the validity of any transaction or agreement with customers.
Operating Impact
The bank must bear the monetary penalty but the release does not impose any fresh operational restriction. The action serves as a regulatory censure for non-compliance with exposure and asset-classification norms, with no stated direct impact on depositors or borrowers beyond the penalty itself.
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 3.50 L
- Order Date
- 10 May 2021
- Effective From
- 10 May 2021
- Entities Affected
- 1
- Entity Role
- Primary
- Entity Type
- Co-operative bank