Recorded RBI impact
Fine: Rs 2.00 L
Monetary penalty · Fresh imposition
Published by RBI
14 Sept 2023
Case Brief
The Reserve Bank of India imposed a monetary penalty of ₹2.00 lakh on The Becharaji Nagarik Sahakari Bank Ltd., Dist. Mehsana, Gujarat, for non-compliance with RBI directions on placement of deposits with other banks by Primary (Urban) Co-operative Banks. The violation arose from a breach of prudential inter-bank counter-party exposure limits, as revealed during RBI's statutory inspection and review of related reports. RBI issued a show-cause notice, considered the bank's reply and oral submissions, and then concluded that the contravention was established and warranted penalty.
Why RBI Acted
RBI imposed a monetary penalty under Section 47A(1)(c) read with Sections 46(4)(i) and 56 of the Banking Regulation Act, 1949 after its statutory inspection found that the bank had not complied with directions on placement of deposits with other banks by Primary (Urban) Co-operative Banks. The inspection and related reports showed a breach of the prudential inter-bank counter-party exposure limit, and RBI concluded the charge was substantiated after considering the bank's reply and oral submissions.
Operating Impact
The bank must bear the monetary penalty, but the release does not impose any new operational restriction or withdrawal of business permissions. The action is backward-looking and compliance-focused, with no stated direct impact on depositors or customers beyond the penalty itself.
Regulatory Basis
- Section 47 A (1) (c) read with Sections 46 (4) (i) and 56 of the Banking Regulation Act, 1949
Action Facts
- Primary Impact
- Fine: Rs 2.00 L
- Order Date
- 22 Aug 2023
- Effective From
- 22 Aug 2023
- Entities Affected
- 1
- Entity Role
- Primary
- Entity Type
- Co-operative bank