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The Reserve Bank of India (RBI) has imposed a monetary penalty of ₹1.25 lakh on Nagrik Sahakari Bank Maryadit, Jagdalpur, Chhattisgarh for non-compliance with directions issued to Urban Co-operative Banks concerning Board of Directors, Exposure Norms & Statutory/Other Restrictions, and Know Your Customer (KYC) requirements. The penalty was imposed under the powers vested in RBI under the Banking Regulation Act, 1949, following the bank’s failure to adhere to the prescribed regulatory guidelines.
An inspection of the bank’s financial position as of March 31, 2021, revealed several violations, including donations exceeding the prescribed limit, non-adherence to prudential inter-bank exposure and counterparty limits, lack of periodic review of account risk categorisation, and absence of a system to detect suspicious transactions. A notice was issued to the bank to show cause why a penalty should not be levied.
After considering the bank’s replies, oral submissions, and additional documentation, RBI concluded that the non-compliance charges were substantiated, warranting the imposition of the monetary penalty. The action reflects deficiencies in regulatory compliance and is not intended to comment on the validity of any transactions or agreements entered into by the bank with its customers.
[RBI]