Recorded RBI impact
Fine: Rs 50,000
Monetary penalty · Fresh imposition
Published by RBI
19 Dec 2022
Case Brief
By an order dated December 12, 2022, RBI imposed a penalty on The Bechraji Nagarik Sahakari Bank Ltd., Bechraji, district Mehsana (Gujarat). The bank was found to have failed to maintain the minimum Cash Reserve Ratio (CRR) in violation of RBI directions on maintenance of Statutory Reserves (CRR and SLR) for primary (urban) co-operative banks. RBI said the penalty was imposed under Section 47A(1)(c) read with Sections 46(4)(i) and 56 of the Banking Regulation Act, 1949, after considering the bank's reply and oral submissions.
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 statutory inspection and subsequent proceedings found that the bank had contravened RBI directions on Maintenance of Statutory Reserves – Cash Reserve Ratio (CRR) and Statutory Liquidity Ratio (SLR) by Primary (Urban) Co-operative Banks. The inspection revealed that the bank had not maintained the minimum CRR, and RBI issued a show-cause notice before concluding that the charge was substantiated and penalty was warranted.
Operating Impact
The bank must bear the monetary penalty, but the press release does not indicate any additional operational restriction or cancellation. The action serves as a compliance enforcement measure and does not pronounce on the validity of the bank's transactions with customers.
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 50,000
- Order Date
- 12 Dec 2022
- Effective From
- 12 Dec 2022
- Entities Affected
- 1
- Entity Role
- Primary
- Entity Type
- Co-operative bank