Recorded RBI impact
Fine: Rs 1.00 L
Monetary penalty · Fresh imposition
Published by RBI
16 Dec 2024
Case Brief
The Reserve Bank of India imposed a monetary penalty of ₹1.00 lakh on Tarapur Co-operative Urban Bank Ltd., Dist. Anand, Gujarat, for non-compliance with RBI directions on placement of deposits with other banks by primary (urban) co-operative banks. RBI said the bank had failed to adhere to the prudential inter-bank counterparty exposure limit. The penalty was imposed under Section 47A(1)(c) read with Sections 46(4)(i) and 56 of the Banking Regulation Act, 1949, after a statutory inspection, issuance of a show-cause notice, consideration of the bank’s reply, and oral submissions in a personal hearing.
Why RBI Acted
RBI imposed a monetary penalty after a statutory inspection found supervisory non-compliance with directions on 'Placement of Deposits with Other Banks by Primary (Urban) Co-operative Banks (UCBs)'. RBI noted that the bank had failed to adhere to the prudential inter-bank counterparty exposure limit. The penalty was imposed under Section 47A(1)(c) read with Sections 46(4)(i) and 56 of the Banking Regulation Act, 1949, after notice, reply, and personal hearing.
Operating Impact
The bank must absorb the monetary penalty, but the release does not mention any new operating restriction, cancellation, or suspension. The action is focused on compliance lapses concerning inter-bank deposit placement and counterparty exposure limits; no direct customer-facing restriction is stated.
Regulatory Basis
- Section 47A(1)(c) read with Sections 46(4)(i) and 56 of the Banking Regulation Act, 1949
Action Facts
- Primary Impact
- Fine: Rs 1.00 L
- Order Date
- 13 Dec 2024
- Effective From
- 13 Dec 2024
- Entities Affected
- 1
- Entity Role
- Primary
- Entity Type
- Co-operative bank