The Reserve Bank of India (RBI) has imposed a monetary penalty of ₹2.00 lakh on Nagrik Sahakari Bank Maryadit, Durg, Chhattisgarh, by an order dated November 16, 2021, for non-compliance with directions issued to Urban Co-operative Banks regarding Exposure Norms, Statutory/Other Restrictions, and Know Your Customer (KYC) requirements. The penalty was levied under the powers vested in the RBI through Section 47 A (1)(c) read with Sections 46 (4)(i) and 56 of the Banking Regulation Act, 1949, in view of the bank’s failure to adhere to the prescribed regulatory guidelines.
The action is based on deficiencies in regulatory compliance and does not comment on the validity of any transaction or agreement entered into by the bank with its customers. The inspection report, referencing the bank’s financial position as of March 31, 2020, revealed several lapses, including failure to comply with prudential inter-bank (Gross) exposure limits, non-adherence to prudential inter-bank counterparty limits, and the absence of a system to identify suspicious transactions, all constituting violations of RBI directions.
Following the issuance of a show-cause notice and consideration of the bank’s replies, the RBI concluded that the charges of non-compliance were substantiated and warranted the imposition of the monetary penalty. This move underscores the RBI’s commitment to ensuring regulatory compliance and strengthening risk management and customer protection in the banking sector.