Recorded RBI impact
Fine: Rs 10.0 L
Monetary penalty · Fresh imposition
Published by RBI
27 Jun 2022
Case Brief
By an order dated June 24, 2022, RBI imposed a monetary penalty of ₹10.00 lakh on The Tiruchengode Co-operative Urban Bank Ltd (No.8994), Tiruchengode, Tamil Nadu. The penalty followed an inspection that found non-adherence to directions relating to Exposure Norms and Statutory/Other Restrictions – UCBs and Know Your Customer (KYC) Guidelines – Primary (Urban) Co-operative Banks. RBI issued a show-cause notice, considered the bank’s reply and oral submissions, and concluded that the violations were substantiated, warranting the penalty under the Banking Regulation Act, 1949 (AACS).
Why RBI Acted
RBI imposed a monetary penalty after an inspection (financial position as on March 31, 2020) found violations/non-compliance with directions under Exposure Norms and Statutory/Other Restrictions – UCBs and Know Your Customer (KYC) Guidelines – Primary (Urban) Co-operative Banks. The bank’s reply and oral submissions were considered, and RBI concluded the charges were substantiated under Section 47A(1)(c) read with Section 46(4)(i) and Section 56 of the Banking Regulation Act, 1949 (AACS).
Operating Impact
The bank must bear the monetary penalty, but the release does not impose any new operational restriction or action affecting depositors or customers beyond the fine. RBI’s note also clarifies that the penalty is based on regulatory-compliance deficiencies and does not pronounce on the validity of the bank’s customer transactions or agreements.
Regulatory Basis
- Section 47 A (1) (c) read with Section 46 (4) (i) and Section 56 of the Banking Regulation Act, 1949 (AACS)
Action Facts
- Primary Impact
- Fine: Rs 10.0 L
- Order Date
- 24 Jun 2022
- Effective From
- 24 Jun 2022
- Entities Affected
- 1
- Entity Role
- Primary
- Entity Type
- Co-operative bank