Recorded RBI impact
Fine: Rs 2.00 L
Monetary penalty · Fresh imposition
Published by RBI
19 Dec 2022
Case Brief
RBI imposed a monetary penalty of ₹2.00 lakh on The Viramgam Mercantile Co-operative Bank Ltd., Viramgam, district Ahmedabad (Gujarat), after finding that the bank had contravened RBI directions on maintenance of statutory reserves, specifically the Cash Reserve Ratio (CRR). The violation was identified during statutory inspection with reference to the bank's financial position as on March 31, 2018. RBI issued a show-cause notice, considered the bank's reply and oral submissions, and then imposed the penalty under Section 47A(1)(c) read with Sections 46(4)(i) and 56 of the Banking Regulation Act, 1949.
Why RBI Acted
Following statutory inspection with reference to the bank's financial position as on March 31, 2018, RBI found that the bank had not maintained the minimum Cash Reserve Ratio (CRR), thereby contravening RBI directions on Maintenance of Statutory Reserves – CRR and SLR by Primary (Urban) Co-operative Banks. After notice, reply, and oral submissions, RBI concluded the charge was substantiated and imposed a monetary penalty under Section 47A(1)(c) read with Sections 46(4)(i) and 56 of the Banking Regulation Act, 1949.
Operating Impact
The bank must bear the ₹2 lakh penalty; no additional operational restriction is described in the release. The action is retrospective in nature and does not itself alter customer transactions, though it reflects a compliance breach under RBI's CRR/SLR directions.
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
- 12 Dec 2022
- Effective From
- 12 Dec 2022
- Entities Affected
- 1
- Entity Role
- Primary
- Entity Type
- Co-operative bank